No, it looks way out of adjustment. There should only be a couple threads showing above the nut, like one or two. That could explain why your clutch isn't working. It would be really loose like that and all the adjusting would have to be done at the hand lever - and there may not be enough adjustment there to take up all the slack.
Now, either that screw is just set really wrong or someone assembled things (in the pushrod/ball assembly) wrong and that called for setting it that way. There could be an extra ball in the assembly. The outer rod could be installed backwards with the stepped end in the engine instead of facing out.
The nut seizing on the screw is common. Both parts are just plain steel and if undisturbed for a long period of time, can and do get really stuck. Once you get it loose, liberally anti-seize both the screw and nut. Take the screw right out and coat it's entire length. To get the nut loose, you may need to gently clamp the assembly in a vice. Clamp it by the lever or the worm, not that tin shroud, that will deform and crush. A drywall screwgun often does the trick. The mild impacting it applies will usually break the nut loose.
