Damage to IP during fuel starvation?

[Diesel Dan]

I've actually got two related questions about my '87 300D:

1. How bad is it for the IP when you run it dry? The reason I ask is that with my WVO setup, I've recently been getting an air bubble that passes through when I switch over. Usually, the car loses power briefly and then recovers, but occasionally it dies completely, and needs to be cranked for a little bit to restart. To what extent is the IP lubricated by only the fuel? Any time I open the fuel system, there is a certain amount of cranking that happens, so I assume the IP is built to withstand some dry operation. But I'm not sure if there is a difference between just dry cranking, and dry running at speed. And yes, I do plan to find the air leak soon. I've ordered some clear fuel hose, which should aid greatly in isolating the problem area.

2. My second question is pretty ignorant, but here goes: What is the difference between direct injection and indirect injection? And which one does my car have?