The PCM still uses the IAT to adjust timing maps. At least, that's how most cars work. I don't think anyone here knows the Protege PCM well enough to know for sure what all tables it affects. Dangling in the engine bay is probably pretty close to the temperature of the air the car is sucking in, unless you have an Injen or similar intake that is truly separated from the engine bay air, in which case you might run a little less advanced spark which isn't necessarily a bad thing in this car.
It shouldn't really help with hesitation since that is a function of the PCM. It may recover quicker by the more accurate MAF signal a blow through setup creates, but the real cause of the hesitation can only be eliminated with some sort of engine management.