Here's another fine build blogged.
I built that kit maybe 30 years ago. Mine cracked exactly where yours did. Maybe it's the plastic and not the age of the kit. You don't say that the original decals gave you any trouble, so that's to the good.
The 'thing on the wing' is a camera-gun. They were fitted when the Nates were relegated to advanced fighter training. I guess that's a flight school color scheme, though I can't say which one. I know this because I used to have the old Arco monograph on the Ki.27.
The Nate is one of my favorite Golden Age fighters, I have a dozen finished in 1/285 scale for the China War or early 1942 CY6, and a set of 1/144 F-Toy pre-paints that I need to assemble. Sadly, I gave the built kit away to a convention raffle, 'cuz 1/72 turned out to be one too many scales for me.