That was pretty common in the early eighties . . . there is nothing really wrong with it, except for the fact that the oil fill is usually higher than the turbo drain, and when it is, you would need a scavenge pump . . .
Yes, with a pump. I just finished my billet pan and he was suggesting the drain location as stated. I know it works for him, but had never seen it done else where. Im going to machine a fitting to do as such, will post pics of the bike soon.
This is RCC's version, which runs the drain line from the turbo right to that AN fitting. The oil dumps back into the engine behind the starter clutch, no need for any other lines. You can see more here: