You are correct. If the guy was driving an unsafe vehicle then I would say the responsibility is a push.
The description of POS was based on the age of the car in the story. There was no other evidence of the car being a POS. My POS 1995 Celica is in pristine condition but I think that if I were the driver in the story my car would be referred to as a POS based on the age of the car.
I think there is. The dog in question offers no more of an obstacle than a gallon of milk sitting on the road. It's a puny dog and at 13 lbs., this one was probably fat. The damage is entirely consistent with rusted out sheet metal supporting both the radiator and the plastic bumper fascia. That plastic is flexible and hitting an animal twice the size wouldn't crack it. I'd bet most of the floor was rusted out, the brakes were n.g. and the suspension attachment points were rusted to the point where they'd tear free if a small pothole was hit.