i think cool air here means air wif outside temperature. it is considered as cool air bcoz d temp u get frm CAI is lower temp compared 2 short ram intake. short ram intake's temp may reach up to 100 degrees n above coz d air taken frm inside d engine compartment.
just take at 80 degrees which is d stable temp after u warm up ur engine n compare 2 malaysia's outside temp, which is around 35++, it does look cooler. so thts y they call it cool air intake.
about d condensation, a very2 small amount of water wont hurt d engine. they give extra uumph inside d combustion chamber. scientifically, i dun know d reaction n equation, but logically, it does help burning 2 grow. like d chef at sum restaurant where they have fire in their kuali, actually they just put water in d kuali. when d water evaporates, it produces Oxigen n Hydrogen, which is easy to burn.
personally, i do think frm CAI, u can get condensation, but not alot. it is there but i think u cannot detect it without any modern equipments. + inside d combustion chamber oso wif d compression is high, it might make d water cannot condensate like under normal 1atm.