I have a old Peugeot that I bought as a fixer-upper (And a practice bike) and I had a few questions about the bike that I need some suggestions on. As you can tell, I was learning how to replace cables, still need to take apart and shorten them. Also I switched out the heavy steel rims with some lightweight alloy rims I had. And did some MAJOR degreaser on the bike.

First, the pics:






Ok, the questions.
1. Any guess on the year and model of it? I know yall hear this question 12 times a day, so this is the 13th The serial # that I found stamped on the rear drop-out is: 655752. The guy I bought it from said that he thinks it is from early/mid 70's. He bought it when he was in college and rode it to school in the 70's for 4 years and it has sat in the garage since then.
Components:
Brakes: Mafac "Racer"
Front Derailer: Simplex
Rear Derailer: Suntour Honor
Lightrace Cranks with 52/40 Nervar Chainrings
And the rear hub is a Normany which he said he thinks is original, but the front is not

I dont know what all components are original and what has been replaced

Question 2: As you can probably tell by the seat, the bike does not fit me. The bars feel way to stretched out when I am riding. (Maybe I need to buy a bike from East Hill, I'm 5'6") So the way I see it, I have 3 options. 1. Try a shorter stem (?) 2. Maybe some mustache bars or something that would put the bars farther back for a more comfortable ride. 3. Ebay/ Craigslist it and make a few bucks and wait for the one in a lifetime chance (in my town) of finding a vintage bike in my size ~52 cm.

Opps, and question 3: Would it be a sin, if I keep the bike, to replace the vintage rack with a new rack with the hooks on the bottom so I can attach some grocery panniers for my commute?

Thanks in advance!!