It's not completely enclosed, but yes, it's still in the cubby. I don't really have any other space to put it in, and I can't fit it on top of my desk, or next to it.
The front of the desk cubby is completely open, and there's a hole in the bottom and top of the back side.
I don't currently have sides on my case, either.
My thoughts with the AIO liquid cooler were, it will effectively pipe the heat to the rear exhaust fan area, and then vent it to the outside of the case, rather than just dumping the heat inside the case, where it may circulate more than exhaust.
I did mount a 120mm fan to the top of the case (there's one fan mount spot there), blowing upwards. And there's a 120mm red LED fan mounted as a front lower intake.
What can I say, it's a cheap case, it only cost me $30, but I had it on hand, and I wanted to get this Ryzen 5 1600 rig built ASAP. I might mount it into a better case later on. (I want a Phantek P400 with RGB LEDs and Tempered Glass side-panel.)