The basic topping lift tackle that is rigged on the majority of 70's80's era small Catalinas is pretty simple. My 78 C27 can be described thusly. A static wire from the masthead to a few feet above the boom end. There was an eye crimped to the both ends for attaching to the masthead and the boom end control line. A small block was attached to the end of the static TL. The control line was knotted to an eye strap on one side of the boom, up through the TL block, then back down to a cheek block on the boom opposite the eyestrap. The line was led forward a few feet, being held captive by another eye strap on the boom to a HORNED JAM CLEAT. The line was lead far enough forward to keep it reachable from the cockpit when the boom is let out.
Looking at your rig: you have
jam cleats on both sides of the boom. That style cleat works well and is inexpensive... remember they were really poplar before the cam cleat craze took over with jib sheets.. because you set the line by pulling it into the wedge side horn. With a vee style cleat, such as the "clamcleat" you have to press the line down into the vee as you pull.... pretty hard to do sideways over your head. With the jam.. just pull on the stopper knot. Also, you don't want a lot of purchase.... 2:1 at the most, I kept mine at 1:1... because that puts too much line hanging down into the cockpit... The TL only has to move the boom a couple of inches. And all you're really doing is removing slack.
The track mounted on the boom side is not factory equipment. It looks like part of a Harken or Shaeffer reefing kit... the track allows for multiple reef blocks to be mounted or a single to be repositioned... but as others have mentioned... unnecessary for the price... but don't throw it away. Here's why....
Harken Single Line Reefing Kit Yep, that's the right price. There are many uses for track and related hardware.
Your question about reefing with a Lazy Jack bag........... yes, of course. When you reef you're only going forward to secure the tack point, the clew can be secured by the ling running forward to a cleat on the boom near the mast, where you'll be during the procedure. You don't have to tie the sail to the boom, just the tack and clew.
Final comment. Get used to seeing modifications and upgrades to all older and some newer sailboats. Remember, that Catalina manual referred to was published 50 years ago... things change. I have added many nifty upgrades, alterations and improvements to my boat in the 26 years I've had him. Improving and modernizing old sailboats is a very popular thing to do... not to "flip" it... but to simply make it better.