Wouldn't affect them at all. In theory, by wrapping the exhaust the spent gases are supposed to exit quicker, thus you will have cooler engine temps. I could believe this theory more on the race track. But with everyday riding, should not make much of a difference.
Not a good idea. Have seen premature rusting and oxidation from moisture that is trapped in the air gap. If you want to wrap, pull the heat shields and wrap the pipe.
I would pull the shields and wrap it but from what i've read on here the heat from the side shots under your leg is unbearable
I ran Side Shots on a 95" Deuce for over a year and never noticed any heat issues but the bike was an '05. I understand the later models run leaner and throw off more heat but if the bike is tuned, there shouldn't be any heat issues.