PO of my bike bought and installed K&N jet kit 81-9179 supposedly.  When I re-did the carbs the main jet was a 118 and the pilot jet was a 37.5. He also mentioned drilling something, but his memory is fuzzy.  If the above is correct, can I go with a lunchbox or similiar setup, or do I need to stick with the stock airbox?

Have you seen This Page?

It mentions air intake/box depending on your situation.

a 118 main jet?   I thought 122.5 was stock for mains.   odd.

DJ did some funky ass needle engineering, very very thin needles, and they can jet it richer ... they do give you a 122 main if you're running like a K&N in the airbox.
118 is the mains for all stock 122 and 128 and their 134 is for K&N pod and pipe. Needles are steeply tapered and very very thin.
Cool.
Srinath.