Matthew,
not only old fishing rods, look out for broken snooker cues too, the tapered ends are superb for mast top ends.
The rudder, if loose, is ok. It'll act like a weighted tiller, so don't tighten it up. As the boat heels the rudder, because of its weight will try and fall to that side, this will give slight steerage for the yacht to fall off the wind (lee helm). The wind is pushing the boat over (heeling) and taking her into the wind (yachts are usually set up to have weather helm.)
Look up on the inter-web about weather and lee helm etc. Be warned, some explanations are incredibly complex, read the simplest, just to appreciate the idea. You impart weather helm to the yacht by either changing the mast angle, or moving the mast foot forewords or aft, which you cannot do as your mast sits in a deck hole.
The loose rudder is a very simple attempt to keep the yacht sailing in a near straight line. Vintage boats had a set of rudders of differing weights which could be changed quickly on the pond side, some even had a threaded weight within the rudder to adjust the pivoting motion. See how she performs first, as the most important feature is to produce a pair of balanced sails resulting in their combined centre of effort being located correctly just abaft the mast above the ballast etc. It is their setting that will have the most control on direction of sailing, rudders on boats are used for manoeuvres in harbours or for tacking/gybing/waring etc.
Have fun. Aye Kim