prior rd was cheap shimano rapid rise. c101 I think.
I used the sheldon brown method :"technique for setting chain length is to thread the chain onto the large/large combination, without running it through the rear derailer."
as far as the derailleur being vertical if the chain is on big small (which is the case in pic1)...I'm guessing this means the pulley wheels are vertical, not the chain line?
hopefully it's not a full ten links short though, bc I will need to buy an extra long chain.