Yes, it's usual for a genoa head to be "all the way up", i.e., within inches of the top of the headstay. The longer the luff, the more sailpower you have, other things being equal. It's like a longer wing on an aircraft giving you added lift. This is true irrespective of the "slot effect", i.e., the dual-purpose role of a headsail in creating a slot to speed wind through to increase the pull of the mainsail, while itself providing a considerable amount of pull.
This is why a headsail, alone, is often an efficient sail to windward. Also why, when you drop the headsail, the boat slows WAY down when going to windward. It's always fun watching newbies trying to sail to windward with just the mainsail :-))
The pennant at the tack of a headsail is often used to lift the foot of the sail up enough to clear the pulpit and lifelines. Since these are typically below the foot of the mainsail, only the "lift" effect of the genoa is compromised, not the "slot effect".
My guess is that the sail wasn't designed for your boat. But, if it's in good shape it might be just fine unless you're racing :-))