Been many, many years since I worked on that furler on my 33.5; however, it appears that the black plastic "stopper" bushing has slipped down and is preventing the drum from rotating concentrically within the deck cut-out. Try repositioning the bushing by raising it into the furling drum tube and tighten. Yes, you can adjust the height of the drum, to a limited degree, by adjusting the height of the bushing. The top of the furling drum should be about flush with the deck. I really don't see the need for cutting the foil or recutting the sail. It worked before, so it should continue to work once the before mentioned adjustments are made. Be sure to adjust the halyard as recommended by @jssailem; not too tight / not to loose. Don't want to see any wrinkles or crows feet in the sail fabric at the luff.