Remove top cover- remove lower nut, mark placement of lower lever for reference for re-installation. Remove shaft- sand with fine emery or steel wool.

Inspect shaft and housing for abnormal wear- if either heavily worn and loose- discard and look for another. If good.. 

Remove and discard rubber sweepers at top of shaft. Drill and tap side of housing to accept grease fitting- make sure to use a short enough grease fitting so it doesn’t contact shaft when assembled- grease shaft upon reassembly - place small amount of grease in upper chamber – do not pack fully so grease has room to travel- Reassemble-reinstall. Reinstall lever in same place it was removed from- Zirc on side can be hit with a grease gun during  periodic maintence, but shouldn’t need much attention. 

The biggest problem with the hydraulic idlers is that the coned 'seal', which is not really a seal at the bottom of the idler starts to leak and won't hold oil- There is no replacement seal to my knowledge. The shaft and housing are machined and there are no bearings. If it runs dry of oil it becomes super stiff and can break in terminal cases.

The area of most necessary lubrication is the shaft and area that it fits in the housing. Putting a zirc on the top isn't as good as one on the side as it'll fill the top of the unit but may take a while to filter down the close tolerances of the housing. If it's injected on the side it will creep both up and down the shaft. When we do them we don't fill the top of the idler fully, so the grease has somewhere to move and expand. You have to also make sure that the threaded part of the zirc isn't so long that it contacts the shaft- the housing isn't that thick- I can expand on this but the day job's getting in the way at the moment.

As to the question of losing the hydraulic action, if there's no oil in the stock idler it won't have a lot of hydraulic action.

As long as there's grease in the thing and the housing and shaft aren't oblonged it should work fine. The one with the zirc- can be shot with a grease gun periodically.

Vendors do have the aftermarket idler that is made of a roller bearing which works fine also- it doesn't come with an idler arm so you have to transfer the arm over. 

For adding zirc- From memory this is what we use- surely there are other options:.

002 Drill bit
14/28 Tap
14/28 Zirc- can be straight, 45 or 90 Degree elbow
part # for 45 degree is Alemite B1637-B1 or equivalent
Size 1/4/28 Taper thread SEA-Lt.