Cycling is a non-natural activity (i.e., homo sapiens did not evolve bio-mechanically over millions of years to ride bikes). As such, the only real rule is whether or not it works for you. Many road bikes are set up for racing, where the effort is high and the change in position small. Here the drops are often used for sprints and hard efforts. Because modern races are quite short most people spend the majority of time in some sort of aggressive position and as such getting up tall wasn't really needed (contrast this to historical races which were generally much longer so having a very upright position was important). For the few times where an upright position is required (e.g., extended climbs) the bar tops now fill this role. As such, over time the hoods have evolved into de facto position, with now a short distance to the drops (i.e., compact bars). It doesn't have to be though. If you go back and look at road cycling photos from the 1920-1950, the drops tended to be used more and the hoods less so. In fact the brakes were really designed to be optimally actuated from the drops. Drops were also much deeper (compared to modern road bars) as there was more of a need to have a bigger range in positions then.
I would ask the following:
- Is your position sustainable? (i.e. comfortable over long periods of time)
- Can you use all your controls effectively? (i.e., shifters and brakes)
If you can answer yes to both then you are doing reasonably well.
Can you optimize further? Potentially, but you won't know until you experiment. I would suggest keeping a log book of your bike set up along with notes on how you feel. This way you can always revert to a previous setting. If you want to ride using more of a modern form (i.e., you have a modern road bar and a modern set of shifters), then try flipping your stem down. The hoods will likely become the go-to position and the drops for harder efforts. Ideally, you should still be able to use your drops, they will however feel best during harder efforts. See if you like it, if not try a different change. Also note that hood angle plays a huge role in comfortable when riding on the hoods. Modern hoods should be angled up slightly. I actually use a digital level to ensure even settings. You can also pull the bar tape and measure with a ruler against the edge of the bar to get the same result.