The wheel should be close to perfectly centered in the well when the steering is straight ahead. I can snap some pics of my e30 for you to compare. If you have a bent suspension arm it'll rub the wheel in the well and cause all kinds of alignment & tire wear problems.
I'd bet your lower control arm bushings are shot. They're big rubber bushings mounted in 'lollipops' on the rear of the wheel well. Also known as LCA bushings, they're a common point of failure on our cars.
Other than that it could be a bad tire, bent rim, unbalanced wheel or bad bearing.