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PCV vents the crankcase gasses back in the intake to control emmisions. Normal.
Being the connector elbow is cracking it’s allowing for the moisture collection there. Replace the elbow and it should be fine...
Yes,, the crankcase pressures or blow by (small amounts of oil vapors) are moved through the PCV and into the intake to be burned under normal combustion. In the days of old, the ‘blow by’ was just vented to the atmosphere.. Small amounts of oil deposits in the fitting would be normal...
The elbow degrades over time with heat and oil causing the cracks...