I agree that doesn't look right. Here is where you get down in the mud and figure out how to work with what information you've got available. We can consult the Bally 1976 Parts Catalog (a must-have reference) and see on page 46 the detailed parts listing for the score motor of the Old Chicago. It looks like cam 12 has one switch which is part number ASW-C-10-11.
On pages 25-27 there are drawings of a bunch of different switch part numbers so you can see exactly how they are supposed to look. But that one is not shown. That part number is also not found on any score motor of the 2 similar vintage Ballys I have (Bon Voyage and Monte Carlo) so I can't look at one to compare. Nor is that same part number found on any of the other cams on the Old Chicago score motor.
Best thing to do would be to see if someone with an Old Chicago could share a close-up pic.
Now venturing into my personal theories based on your photo (nice close-up): Let's think about the function of this switch. Its job is to briefly close when the cam 12 nub comes along, thus energizing the drop target reset solenoid, and thus resetting the drop targets. The black kind of u-shaped bracket on the underside of the bottom blade will be pushed upward by the cam nub, thus closing the switch.
The top blade (flat) has an additional helper blade (bent shape) attached to it. Why is that there? My theory is that it is there to make sure that the top blade stays away from the bottom blade by physically holding it back. Because as we now know, if that switch gets stuck closed its going to energize that solenoid all the time and that solenoid is not made for that. So it is a stiff reinforcement that presses down against the bottom blade, but as jrpinball said, there has got to be an insulating piece of paper in between there! Otherwise, its just closed all the time.
You could test this I think pretty easily. You could cut a small piece of thin cardboard or card stock and wedge it between that top helper blade and the bottom switch blade, thus insulating it, and test. Or if you want to get ambitious you could physically bend that helper blade up enough so its not making contact, although that is a bit hackish (but should be reversible).
Eventually you would need to fit in a correct piece of insulating paper or fish paper as they call it. Check out this thread:
https://pinside.com/pinball/forum/topic/fish-paper-for-switches