Jeff -- how damp does the dry grass get?
I assume it's a shallow-like quilt box full of dry grass over the inner cover, with a screened inner cover hole and no ventilation holes on the sides or anywhere else?
The insides of your hives look pretty dry.
It looks great, and I do something similar, though I don't think it would work as well in my climate. Today, for instance, I've got 100km winds (62mph) blowing freezing drizzle off the ocean all over my hives. My hives would be soaked to the bone (and I've seen it) without extra ventilation up top. A great deal of the humidity in my hives comes from the outside environment, not just from the bees breathing and eating honey.
With the sugar cakes you've got up top (looks similar to what I do, a 12:1 sugar-to-water mix), do you get much sugar dumped to the bottom of the hives?