[Joe]

the radiator will be the air trap. The air trap does not NEED to be at the top of the system in a well designed setup. The setup above just screams for air to collect up top. Not to say that no air will get caught in the air catch, but not as much as will stop up in the radaitor. Turn your pump off for a few min and the air thats been churned into the water will collect and "pool" up top ( or the highest point it can get to). An air trap at the top is the BEST option, but not the only option; as hmale said, you dont NEED to put it on top. But if I designed a system it would be. Putting your radiator at the top will let a good deal of air sit there. Very few pumps have enough flow in systems to flush all the air DOWN in water and collect lower in the system.

Use the analogy as above, if you put a shot glass under water, where does the air go? the highest point it can.

Higher the better, and some radiators are better than others. the Tube/Fin kind are not that bad for being up top since there is few areas the air can get trapped in it. but heater cores and such are very bad for trapping quite a bit of air.