I JUST put this IP on my motor and it started leaking...
it leaks after the car's sat for a while ( like all night) and then it is hard to start when cold...
its been leaving about a 12 inch spot of fuel on the ground every morning.
The question is this: what can be damaged by running it like this?
BAH Timing Cover...

Does look like that belt is tracking a bit to the outside of the IP sprocket.. You should fix that and tell me what you did.. My former now recent again 81 rabbit has been the same way since I bought it, sold it it, bought it again.. Never hurt the belt but still does it after shuffling the IP brackets around and a rebuild...
I know of several engines destroyed by broken alternator belts due to not having the cover in place and the alt belt being slung into the timing belt, a couple from a bolt coming loose and dropping into the belt, one from a piece of slag left over from a weld, a couple from rocks, and I even know of one that was done in by a plastic bag. And yet, I keep the cover on and I've never lost an engine personally from a timing belt failure. Considering how easy it is to fit the cover and the fact that I'm not personally a fan of the drama related to changing engines for no good reason, I fit my cover. If you like the drama of living with a bit of additional risk with no benefit, and feel that the somewhat unlikely event of a pointless engine replacement would be worth the added "thrill" then perhaps not fitting a cover makes more sense for you. Thus the comment "Russian Roulette anyone?".
100% on target !! My belt is tracking like this after shaving my head and I don't have time during the week to adjust it, so this morning before I went to work I R&R'd the cover to inspect the belt - took a couple of minutes and I didn't even fire up the compressor for air tools. Much to my surprise, the belt had tracked 1/2 way back to home. (so now about 2mm off center).
Maybe all those people I see running w/o the covers like the looks of the cog ? Maybe they should make one out of plexiglass ;-)