I have a bad exhaust leak at the flex pipe..somewhat crappy idle..any suggestions?

So ever since I bought my car, ive noticed the exhaust has been extremely loud..and it rattles alot at the flex section. The car smells like exhaust all the time and my idle is sometimes a bit crappy. Doesnt go below 690RPM, it stays between 700-850. I do have hks 264/272 cams. 
However, today i decided to jack the car up and get undernath while the car was on, and I noticed a huge leak at the flex section of the pipe. The flex section seems to be the middle part of the downpipe itself, like custom or something. I could feel alot of air coming out of the flex section so that explains the loud exhaust. Im serious, nobody in my family liked riding with me because of how loud it is, I mean ive had some loud DSM's but this is the loudest one yet. 
My friend said that he knows someone at a muffler shop who can fix it for me. My question is, could this be the reason for somewhat weird idle? My CEL has been coming on with the P0300 code (multiple cylinder misfire)..it only comes on when the idle gets choppy sometimes. 
Ive replaced plugs, wires, and even did compression test and got 178 178 180 178. These numbers were without going WOT. Im sure they would have been slightly higher. My car has 60k miles on it.
So any suggestions, or can anyone connect these issues to a solution?

 

A: Heres a pic of the flex pipe.  dont pay attention to the dented oil pan, I bought the car like that...no leaks, or anything. 

A: well if you have non stock cams, that is probably normal. Your exhaust looks pretty hacked together. There is usually only a braided 6" section of flex in the down pipe. Leaks however will not cause and problems in your idle. Be sure to check that your MAF is plugged in good, and that your recirculating your BOV.

A: Its a 2.5" extreme downpipe, and 3" Tanabe Racing medallion exhaust with testpipe. What do you suggest I should do? Get a new downpipe or just have the guy at the muffler shop make another flex pipe? THe flex section seems to be slightly more than 6 inches long. I forgot how long it is. But the flex section makes alot of noise, it rattles, and makes other weird noises. While i was down their, it was coming from that flex section, sounds like ghetto rag sh**. 
I know we have a rear 02 sensor, so Im assuming it is throwing codes based on the major leak at the downpipe/flexpipe. Also at my exhaust tip, it makes this sound like when you flick your teeth..this car has turned out to be ghetto rag

 

To be continued……..