The hole in your wheel well, is actually a hole in your frame rail and NO it is not supposed to be there. As for your fender, if I get what you're asking, no there isn't a skin or anything that's supposed to be there. Not sure what's going on there, but it may just be a poorly fixed, mounted, or modified fender. Looks like there's a bit of bondo on there so it's hard to tell.
I wouldn't go so far as to say his car is junk. Not that I'm an expert (I'm not), but it's probably junk for a racing application like what you deal with. Mine isn't too much better than that car based on just what I can see, but it's still pretty solid. Much worse condition cars have been fixed.