Elect Ign Distributor Output LOW?
A pickup should output about 6V or more at 600 RPM. Cranking engine, distributor rotates at about 100 RPM, with output 1V or more.
Something like a turn to turn short in pickup coil, or fractured magnet could result in significant loss of signal. A turn to turn short may not be measured with Ohm test. It would show up in an inductance measurement, inductance significantly less.
Pickup to reluctor gap also influences signal output, it follows inverse square relationship. A normal gap is bout 0.008", if doubled to 0.016" resulting output 1/4, at 0.032" ... 1/16. Serious attenuation with gap increase.
About grounding distributor body, it helps protect pickup and sensing circuit from high tension spark discharge. Opportunities exist, due to leaving out rotor, dropped plug wire...