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I'm sure air will pass both ways, it probably just has a screen filter on one side so thats the side they want the air inlet on. Also all we really care about is the air going into the tank being free of moisture, so if I installed one it would be with the inlet side facing away from the tank...

I'd be worried about gasoline fumes, but are diesel fumes that caustic? It can handle oil, the beads are replaceable, and the body is zinc. I don't see what could go wrong. (Famous last words I know)

I've been thinking about an in-line desicant dryer for air lines. https://www.amazon.com/Compressor-Filter-Compressed-Desiccant-ZN312-D-2/dp/B07T2865YX/ref=mp_s_a_1_3?dchild=1&keywords=refillable+desiccant+dryer&qid=1604514047&sr=8-3