Your dealer is correct, there is not such thing as any "stage" flashes for the V-Rod. There are simply flashes for the different SE pipes and somehow everyone started calling the SE Slip On flash stage 1 and the 16GA flash stage 2.
He is correct that the 16ga flows less than the SE Slip ons at various points over the rev range but his analogy to fuel is wrong

Less airflow = less fuel , period. The 16ga flow better down low and lower up top so it will be richer in the lower range and leaner in the mid to upper range. This means the MAP you have for the PCIII will be adding fuel where you don't need it and taking it away where you want it.
I'm not trying to make you spend more money but to get it right you either need the SE Slipon Flash (P/N 32026-02A) or some time on the Dyno. For a good PCIII operator you shouldn't need any more time than the cost of the new flash installed and the bike would be tuned to YOUR specs.