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my girlfriend's dog (West Highland Terrier) lies around like that, too. If Pancho's comfy like that, then I'd say it's perfectly normal 🙂
 
That's how my dog lays. He's a Lakeland Terrier (Think a Welsh terrier that looks like an Airdale).

He also sometimes crosses his front legs, making him look like he should have a cigar and a top hot. Very distinguished for a dog!

Usually he's not so shaggy (we usually shave him):

gus.jpg
 
my dog sits on his hip, either side rather than have his legs under him. :: shrug :: if it hurt he wouldn't lay like that.
 
My dog (a minature poodle) lays around like that too, sometimes. Usually does it in hot weather.
 
If Pancho is feels comfortable like that it's alright!My dog,an airdale terrier lais upside down with his legs up ...well very strangely...you would think is a really uncomforable position until you look at him and he looks so comfortable and sleepy
 
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