My 550K3 had similar exhausts to the K7 and my two lower silencers had rotted out. The chrome was OK but if you stuck your (little) finger in the end it was empty. Sounded kinda offbeat as well. Never a problem with the MOT, but like everything, it depends upon where you go and how picky the tester is.
Performance: it sounded faster than it was! I'm sure the fueling/carburation was screwed up by the lack of back pressure but to be honest, I never noticed.