Ive done three vw cam belts in the last couple of weeks and all seem to run like that,as long as the belt isn't hanging over the otherside I wouldn't worry,is it due a belt?
My belt position sits exactly, before and after i changed it. As for the squeaking it could be down a worn belt tensioner bearing.
If you are going to replace, I would also get the cambelt done. Infact if you buy a cambelt kit, you'll get tensioners with it.