Originally Posted by
Homebrew01
The Quick Release skewer is not meant to screwed tight. It "Flips" open & closed. Look up some videos about bike quick release skewer.
The frame dropout looks like paint damage. Hard to imagine anyone grinding away metal there, but who knows!?
Remove the wheel, or at least slide it all the way forward and backward, and see if it's just paint damage, or metal actually removed.
Horizontal dropout bikes like yours often have a bit of "play", and can be a bit finicky to align the wheel, hold steady, and FLIP the skewer closed TIGHTLY at the same time.
I agree with this. Also, a good trick for centering the wheel is to hang the bike by the saddle, stand behind it, hold the wheel near the seat tube with your right hand and use that hand to center, then use your left hand to tighten the quick release.