the original frame was a double hung box frame.
it was set back behind the nibs of bricks youve found.
thing to do is strip both reveals and the window board arrangement back to bare bricks.
the angle bead in the photo looks like its beggining to rust so pull the side reveal angle beads as well.
the new frame can be set as far back as the installer wants. it can even be set slightly behind the nibs of brick taking into account having a projecting sill and how the outside reveals are made up?