Push up the fender in the place it is attached to the seat post. That should solve the fender problem. If it can't be moved, tough luck - improvise, or get another one. Full metal fenders in my country are some 5 euros - not more.

Rear rack: judging by the picture, I'm 99% sure that you can just bolt it one hole lower. It looks like there is enough space for that. That way it will be level.