Hose goes oil tank.
Working from distant memory here so I may be wrong...
On the older bikes that hose was just vented to the atmosphere, like a crankcase breather on an old car. As years passed and emmissions rules became tighter, factories began to recycle the fumes from these hoses into the airbox for redigestion or as you suggest to a spigot on our oil tanks, above the level of the oil. But I don't think the very oldst bikes had that spigot.
A catch can of any sort is a fix for the older bikes, but it should not be blocked off unable to breathe.