Does your red pvc piece look like this? http://www.flow-rite.com/marine/product … -out-comboThat is actually a venturi valve that sucks air into the water as it flows which aerates the water when on circulation.
Theres also a video on YouTube with Kevin Short I believe explaining the livewells. Purchased new 5/4/15Bass Cat Sabre Vision EliteMercury Pro XS 150MotorGuide 75lb Tour EditionHumminbird – Stock (will be changing soon I hope)