about the drilling of a 5mm hole in the air filter I think is well worthed especially with the malossi kit. Do it, it will take few min. and is not going to distroy your air filter. The of course is not enormous, but worthed.
As far as your engine is normal that with your set up you have to struggle to get in the power band, as you red in my previous posts.
The reed block to go depends on your money. Malossi is not bad at all for the money but be prepared to modify the kit itself to fit to the cranckcases. If you get one you will understand what I mean, and we could solve your mounting problem in this forum in the future if you will encounter some.
If you can afford you could go for the MMW block, the 1 or 2.
(art.no:40811000 - art.no:40812000)
Then you need a Yamaha RD300 reed block, and a rubber manifold of the correct size
If you go for the 2, check the cases area around the inlet port. If itis one of the kind where the area is small you cannot put the MMW2, unless you make some modifications. You could always post here or on my e-mail that you can find in my profile a picture of your cases and I could tell you which one you have if you want to be sure before buying it.
As far as the carb I think it would be much better a Keihin replica (KOSO) 28/30 (art.no:KO928001), then a dell’Orto.
If you need other things or I was not too clear just post again.