The aluminum foil was sounding better but now I am trying to double check the logic behind it and things aren't adding up. Hopefully someone can help me see how the foil is supposed to work in light of the way that o2 sensors work.
This seemed to be a good resource:
http://www.aa1car.com/library/o2sensor.htm
So o2 sensors work by looking at the difference in oxygen levels between the exhaust stream and the engine compartment (they are vented through the wire or through the housing around the sensor).
I am going to make up some numbers here-
Lets imagine that the actual oxygen concentration in the engine compartment is an arbitrary number like 10. Looking at the exhaust stream, imagine that ideal combustion is a 3 and a rich mixture would be 2 (less oxygen) a lean mixture would be 4 (more oxygen).
So, if the sensor compares the differences between the engine compartment= 10 and a lean mix= 4, that would be a difference of 6 (so its output would be less than .45 volts).
A rich mix would have a difference of 10-2= 8 (output over .45 volts).
So, if I reduce the amount of oxygen to the outside of the sensor by wrapping it with foil etc., lets imagine that I have lowered o2 to that end of the sensor so that it always sees a level of 8 (rather than the unwrapped value of 10). So now a lean mix would have a difference of 8-4=4 (very low voltage output) and a rich mix would have a difference of 8-2=6 (output still less than .45 volts).
This rich mix (in reality) would be interpreted by the wrapped o2 sensor as a lean mix because it would be outputting less than .45 volts and the computer would compensate by richening the mixture. So wrapping the o2 sensor could be a bad thing for mpg because it could trigger a richer mixture.
I see how the foil could help keep it warm though.
Please correct my logic here.