OK - here's my 2 cents worth.
If you value your engine, you will install something other than a K&N filter. K&N's flow more air, but they also let a lot of dirt get through. They need cleaned more often than a foam filter, are harder to clean and harder to re-oil properly. Unless you need that extra 1/10th of a horsepower at 15,000 rpm, stay with a stock or aftermarket foam filter. I race and my intake and exhaust are factory stock (except I took the backfire arrester out of the air filter).
Changing the exhaust will give you a noticable increase in HP, but do you really need it? Are you racing and need a bit more performance to outrun someone in your class or are you just play riding and need a little gain for clinbing hills? If you change the exhaust, you will need to rejet the carb, but probably just the main jet by 2 or 4 sizes. If you change the intake then you will probably need to adjust the fuel screw setting and maybe go up one size on the idle jet. After you have made the changes to the intake and exhaust and jetted and adjusted the carb, then you will have to ride it to see if you need to make changes to the mid-range. Hold the throttle at a steady setting at about 1/2 throttle. When the engine levels out, if it runs like the choke is on you will need to lower the needle in the slide and readjust the idle - if it surges like it wants to go faster but can't and if choking it seems to help, then you will need to raise the slide needle a notch and repeat the process until you have it right.
As to the carb leaking? you may need to take it apart, clean it and check the float level. When you have it apart, put the floats in a pan of gas to see how they float. Good floats will be about 2/3 below the surface and even on each end. If the floats are brass or hollow plastic, shake to see if there is fuel inside them. If they are black plastic and relatively solid and if you live where gas is blended with alcohol, just replace them. The alcohol will cause the plastic to swell and the float may either not float at the proper level or may contact something inside the float bowl and might not be shutting the fuel off completely. Another thing to check is that the float needle is smooth and not corroded by alcohol. Finally, check that the overflow tube in the float bowl is not split.
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