Here is an repro original oil filter set up on a 216 engine....
The filter is referred to as a by-pass filter.....only part of the oil is oushed by the pump into the filter and it drains back into the oil pan.....
Your filter is a "full flow" filter where the oil pumps ALL the oil through the oil filter and the clean oil is returned to the engien oil galleys to continue lubricating the bearings....a.k.a full pressure system.
