Bicycle Mechanics - rear derailleur not right

Peugeot PX10? / touring bike.

SunTour / Cyclone Rear Derailleur / real wheel bolt came loose today when riding. Fun!!!

How do I know if the Rear Derailleur is setup right? Concerned about going into a local bike shop with this 70's bicycle. Would like to get as much knowledge here and possibly fix it / Saving $$$.

Note: when reversing the pedals, the chain comes off the top of the rear derailleur.

Check your hanger alignment.

1. Shift into a gear that makes the derailleur arm point straight down.
2. Stand the bike up vertically against a wall or something.
3. Look at the derailleur from the back. The arm should be parallel with the rear wheel.
4. On a bike that old, I'd just bend it back with a big crescent wrench. Older bikes aren't as picky about hanger alignment as ones with 9 & 10 speed cassettes. If you decide to try that, be sure to leave the derailleur bolted in place so you don't ovalize the mounting hole in the hanger.

Removed the rear derailleur. Where it attaches to the bike, the derailleur seems bent at an angle. Will check Ebay for photos of what a rear derailleur should look like.

Checked the bike frame where the wheels slide into the slots. Left side facing front of bike, the slot is ok "=", on the derailleur side, the slot is wide open: bolting the wheel there is no bottom metal to secure the nut. When the derailleur was there the nut would bolt onto that.

Can I have the bike bent back correctly where the wheel slides into the frame?

Most likely this is a U08