Stillen supercharger ???
 

Can someone explain to me why the stock water cooled stillen supercharger is bad and that one needs to the air cool kit to make it work properly.

Search will help you best. start here ->
http://www.the370z.com/forced-induct...r-upgrade.html

I would have NEVER gone with their system if it hadn't been for TopgunZ's upgrade, way too many popped motors with Stillens stock system. He also has a complete package with SC etc here-> http://www.the370z.com/forced-induct...rger-kits.html

what causes the stock stillen supercharger to ruin engines?

Poor design. Also a lot of people are idiots and drive it on Stillen's canned tune.

The MAF's are at the front bumper and before the supercharger. They should be right after the CAC. The air density/temp is way different causing the issue of running lean under different boost conditions. The water to air CAC is in the intake. No place to put the MAF's. That's what causes the issue when folks try to turn them up. They end up blowing the engine. The A2A doesn't have this issue. Most tuners use a hybrid system to tune them also with the MAF's and using speed density. Clear as mud probably.

If you leave it bone stock and are happy with the power it will last forever with proper maintenance

That is not true. The MAF location and the crappy canned tune had led to a lot of failures with the system right out of the box. If you ditch the canned tune you may be ok with the kit as designed, but the combo doesn't work.