Congrats to your find! Them 101's look like simple contraptions, but you'll find that the learning never stops if you get into these bikes. So, to ride it is not the only pleasure.

The oil is consumed or wasted in a total loss system.  It is churned to a mist by the flywheels and flying to all places in the engine. Some of it is wasted out with the crankcase ventilation. Some of it gets into the combustion chamber and exits via the exhaust. The Indian is fairly tight and comparably little is leaking out at joints and shafts. An ordinary modern car engine pumps oil at the rate of tenths of liters per minute. This one pumps the oil at the rate of drops per minute. Every 19th turn of the crankshaft, a small portion of oil is released!

Original there is only one oil petcock under the tank. That petcock is closing off the oil line from the handpump. The oil line from that is leading down right into the left crankcase half. The reason it has to be a petcock there is that the internal valves for the hand pump won't hold tight, so if the petcock is left open and the bike sit for a few days the crankcase will slowly be filled with oil. And during run, the line is subjected to the chequered crankcase pressure when pistons is going up and down, so the valves can't hold tight then either. Mainly the hand pump is used on occasions to fill up the crankcase when it is low level or totally drained. Normally the petcock is closed at all other times.

Sometime owners fitted a petcock on the oil line to the oil pump. That is really dangerous and can become very expensive as it is easy to forget to turn it on. A fitted petcock there usually is a sign that the oil pump is worn, oil is leaking past that and filling up the crankcase when the bike sits for a length of time. The construction of the oil pump normally ensures that no (or very little) oil is leaking past it, but a worn, wrong assembled or tampered pump starts to leak through. 

The oil pump is manually adjusted to the amount of oil the engine wants. It is impossible to tell a specific setting, it has to be checked regularly.  The engine consume oil a bit different depending to the road, speed and air temperature. Tough going, high speed, a lot of hills, a lot of on and off throttle and high heat will use up more oil than parade running and short drives in cool weather. So you need to keep an eye on the oil level in the crankcase. 

There is 2 plugs low on the left side crankcase, the bottom one is the draining plug and top one is the level plug. The bike should rest on the rear stand so the engine is not leaning when checking the level. When you remove that top plug, my preference is that it should come out a small portion of oil. At least some drops to ensure that the level is on top. If no oil is coming out I open up the pump a bit. If a lot of oil is running out, I reduce the pump a bit. 

I am cautious and don't want my engine to go dry so I sometimes allow up to and at the maximum 100cc to come out before I adjust the pump! If no oil is coming out I immediately open the pump a bit. But it might be that your engine smokes excessively with the oil level too high. The pump is adjusted on the hex head screw in the front, and at the extreme 1/2 a turn at a time! Mostly it is only 1/8th or 1/4 a turn. I don't know what pump is on your engine, the adjustment is opposite on the 2 versions that is mounted original, so I can't tell if the screw is turned in or out to increase delivery.

I know constant checking of the oil level is cumbersome and greasy, but it is necessary to learn the engine consumption. It will stabilise and you'll learn in time when you need to open up or close the pump. Draining the crankcase is good to do now and then. Spill on a large bright pan to check for debri from bushings, bearings and that kind of wear and a big syringe with mineral spirit or the like will flush out the remains. 

You can be surprised by the oil consumption before you get the pump right so bring a can of oil with you as backup! It is the same with gas consumption as there is no reserve, I have been stranded more than once!

The oil line down to the pump is large and there is no orifices in the pump or in the engine that can clog up normally, it would take a lot of lint or foreign objects to do that. The risk is if something drops into the tank and obstruct the inlet to the pump or the tube inlet. If the tank has been dry it is imperative to bleed the tube down at the pump. Open up the fillister screw just under the fitting and bleed long and thoroughly to remove any air pocket. 

Keep an eye on the oil level in the clutch compartment. That and the gearbox is connected so they use the same oil. I use the same oil there as in the engine. Sometimes if the cork ring in the drive gear is worn, the engine can either suck or pump in excessive oil into the compartment and then the oil level in the engine is impossible to get right. A tell tale is if the gearbox tower is oily, or the gearbox leaks a lot of oil, then the cork ring can be suspected in many cases.

There is not many parts that can break in the pump. However, rust can be an issue! The pump is a fairly simple "variable displacement piston pump". A drum in the housing is driven by the cam worm gear and 2 pistons travel in and out in bores drilled in that drum. When the drum is turned to a certain position, a inlet port opens and during a period, the piston retracts and oil is filling up the bore, then the drum continues to turn and another port opens and the piston push the oil out into the cam compartment. The ports are wide so no oil pressure is produced in the pump. The piston stroke is decided by a swash plate at the front end of the pump. The swash plate pivots on a pin, the pin ends are visible on the outside of the pump. The attack angle of that swash plate is decided by the adjusting screw. Illustrated principles can easily be found on the net.

I found out in one of my pumps, that it had rusted badly in the forward compartment where the adjusting screw is and that rust had frozen the swash plate on the pivot pin, so any adjustment had become impossible. Not exactly impossible as the screw could push the swash plate in, but the pistons rebound springs wasn't able to push back the plate if the screw was retracted. That in fact is really serious malfunction as the pump only could be adjusted to less delivery and if I hadn't found that, the engine had been starved from oil eventually. Other faults can be one or both broken springs or that one or both pistons is rusted solid in the bores!

It can be checked fairly easy if you remove the screw (keep the setting of the stopnut intact!!) Insert a thin metal rod, i use a drill shank as it can't break like wood or plastic can do, in the hole and carefully push on it to feel that the swash plate do indeed spring in and out to the same position. The movement is only a few mm's and the force of the 2 piston rebound springs inside is not very strong, maybe a couple of kilos...turn the engine some 15-20 turns to check if the spring rebound is equally strong and the swash plate returns to roughly the same position, if not maybe one piston is stuck. Or if the pump is off, use a loose cam to turn the drum inside the pump. It doesn't harm the pump to spray some rust preventing oil in that forward compartment on occation.

Another thing to check, is the state the cam bushing is in the cam cover. A worn bushing makes the cam rattle and a rattling cam wears on the worm gear in the drum. The teeth in the drum is small and if worn too thin they can break. If they break the cam worm can make all sorts of unspeakable mess!