Inline diffuser question

[hypnogogia]

I have the co2 art inline diffuser on the pressure side of external filter. Should I be seeing misting coming out of the inflow, or should the co2 completely dissolve by the time it reaches the tank?

Also, given that the return is near the water surface, how do I get it distributed throughout the tank? Seems to me that it would make sense to have the return lower towards the substrate.