The cooling air is ducted in through the flywheel, up around the cylinder, then out through the front. The grill without holes disrupts the flow, so yes it is going to get warmer than normal. It's not airtight, so yes some of the heat will escape, just not as quickly as they designed it too. Not going to kill it right away, but will definitely cause it to age prematurely, like heavy drinking. 
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Ian
Mine: 72 w/ k301, 3 125's, 1 w/ hydro lift, 38,42, & 2 48 decks, 2 42 front blades, QA-36a & QA-42a thrower, tiller, lo-boy 154. Also, LOTS of parts.
family's:2 105's, 2 106's, 149, 2 lo-boy 154s, Farmall Cub.
Non-IH: 1940 JD Model A, 1954 JD 40 U, 1955 JD 40 Crawler, 2 1956 JD 420 U's, both w/ Henry Loader and Backhoe. JD 110. Wheel Horse (model unknown.) Power King 1614. We love our tractors! 
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