The top jockey wheel should be more than free, it should have some side to side play to enable the jockey wheel to line up with the cog above it. The bolts should also be nice and tight, and held with lactate. If one comes loose the mech will wrap around the cogs. If it is too tight it could bind and lock up, causing the chain to rip the cage clean off the mech. I have seen both happen, it isn't pretty!
My guess is that there is a washer missing, I have a new mech in my shed, if you can't sort it out I will go and dismantle it and photograph the bits in the morning.
The top jockey wheel should be more than free, it should have some side to side play to enable the jockey wheel to line up with the cog above it. The bolts should also be nice and tight, and held with lactate. If one comes loose the mech will wrap around the cogs. If it is too tight it could bind and lock up, causing the chain to rip the cage clean off the mech. I have seen both happen, it isn't pretty!
My guess is that there is a washer missing, I have a new mech in my shed, if you can't sort it out I will go and dismantle it and photograph the bits in the morning.