according to c-systems, there is no seal around the shaft, just like in any mag-drive pump. air should not be a concern if the system is sealed and you have a resevoir. just pinch the outlet tube a few times or turn the system on it's side (make sure you don't suck air from the res back into the pump).
the orientation shouldn't be a concern either, but i wouldn't have the inlet facing down as that will make priming the pump more of a hassle than it needs to be. mag-drive pumps cannot move water if the inlet has a pocket of air in front of it.
i would need more specific details about your system and how you plan to mount everything befor i can comment on pump placement. make it work, make it look good, make it quiet.
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