In the long run, the K&N will save money (don't forget to account for the cleaning kit, oil, and time - also when you clean the filter you lose your car while the filter dries). However, in the long run the K&N flows more dirt too, so you lose engine life and power as you lose compression. Here is one of the only objective tests with actual data (and not some guy's claim) I've seen online:
http://duramax-diesel.com/spicer/index.htm
I know this wasn't your question, but one other test I saw compared fuel mileage using a Geo Metro, and paper and cotton gauze were statistically the same. The paper filter already flows more air than the throttle body will let in. The only time a cotton gauze filter adds horsepower is at wide open throttle, and that is where they get their hp numbers. It doesn't make the engine more efficient, ie more power at low rpm's, but it does let more dirt in at all rpm's.