Hmmm, couple of thoughts.
1) The seal issue is troubling.
2) It appears they've been making them in China for a couple of years now.
3) Just because it is made in China doesn't automatically = bad. How many of the other filter brands are made in China? My guess would be quite a few. In fact I just did a little searching and saw mention of the new OEM filters also being made in China, but I haven't verified beyond a couple of forum mentions
4) Will be interesting to see how/if K&N responds and gets the issue fixed. Can't imagine it won't get fixed soon and how limited or widespread the issue is.
5) I personally will continue to run them, but keep a good eye on them.