leathers should be pretty tight. Like, not so tight that you can't breathe, but there shouldnt be too much room there.
Waist will be a little looser, normally- that's why they have the little straps to tighten it down. But around the chest, it depends:
I bought mine so that it fits with either a sweatshirt underneath, or a nice big back protector. But if you dont wear either of those, it should be snug in the biggest part of your chest.
Basically, it should feel just a *tad* restrictive when you first buy it, then when it breaks in it will be perfect.
Sounds like you need to take it in for sure. Don't be worried if it's material between the arms and chest, though- there's extra there so that you can full range of motion. But if it's not snug on your chest, it needs to come in a bit.