Bob--
You are certainly more experienced in fireplace tech than I am. However, I still suspect that the main issue is moisture, not heat or CO. The installation docs even reference clearance issues due to condensation. I don't doubt that the temp of the exhaust gases may reach 500 degrees at the intake point of the flue above (and inside) the firebox. However, we know that they cool significantly by the time they reach the exhaust point since they are cooled by the intake air which surrounds the the exhaust flue. If the exhaust gases were this hot, presumably the metal housing would be also...at least, it would be after several minutes of run time. If so, I can't imagine that it would be acceptable (as it is) to install it within reach of people on the deck or patio despite the bilingual warnings in French and English...