What is this and do I still need it?

I have the best ignition I have tried to date for my requirements and it is a Flamethrower III unit in a factory points dizzy.

I did not do what you have shown us however! My factory ballast is bypassed by soldering in a solid #12 copper in place of the compensating resistor behind the ceramic housing. I wonder how yours is wired as it seems you may have a double voltage drop to the coil depending on how it was done. We need to see more info on how the second ballast was fed!

I'll snap some photos in the morning and post them. There seemed to be continuity between the blue wires from the old ballast and the blue lead to the new ballast. So yes: possible double voltage drop?