First off...get rid of the blue air stone. It will not benefit you at all for diffussion. You really want to try and find a glass diffuser or limewood at very least. PetCo (if you have one near by) is the only place I've seen carry limewood. Otherwise, you'll have to look online. Ebay is a good place to check too.

When you hear people talking about using the filter to diffuse the CO2 bubbles, what that are doing is taking the output hose of the CO2 and running in directly into the intake of the filter. The impeller of the filter will then break up the bubbles into smaller ones. It's not as efficient and can be a little on the noisy side but it does work.

Hope this helps and feel free to ask any questions you may have. We're all here to help.