I use these type sponge filters on my 10 gal fry and quarrentine tanks, 8 total. They do a good job of housing benificial bacteria, but they do not filter out particulate waste very well, eneaten food and poop. I keep my 10gal's bare bottom and siphon the waste off the bottom and change 50% water weekly. I find the need to shake the sponges under running-non-chlorinated-water every 2-4weeks to keep the pores of the sponge open. Do not squeeze these sponges to clean them, it will shorten their life dramatically by crushing the cells of the sponge. Also I do not make them perfectly clean, leave a "little" muck in there for the bacteria to live on. I sometimes run a flex brush down the bubble tube when they get a bit unsightly with algal growth. Although benificial bacteria live on that algae too. I would not reccomend sponge filters as a single solution for filtering tanks larger than 30 gal because those rising air bubbles just don't move a whole lotta water. I do however always keep several sponge filters in my "healthy" larger tanks 40-75gal so they are always "seeded" with benificial bacteria and ready to go anytime I need to set up a new tank for those suprise fry or the fish I see at a store and just have to get. Hope this helps.
Also you are correct on their operation. Airline-in and the rising bubbles lift water up the tube drawing water up through the sponge. Depending on your airpump you can run multiple sponge filters with tee's and valves. I would reccomend a valve to play around with the airflow to optimize waterflow. Too little air=no water flow... Also... Too much air=no water flow... You'll be able to tell.
BTW. Sometimes it takes a little, or a long, while to get someone to post a reply on here. I only find time for MFK on weekends as do a lot of others.