Flickering Lights

Still would like to know why Blue wire cut at alternator and connected to terminal at bulkhead connector was for or even went to. Would it have been connected to battery terminal of alternator?
No it would not.

For the moment, forget the mess. Lets go back over how it originally worked.
Then what needs to be done will become clearer.

Follow the black wire labled R6 all the way to the big welded junction shown as a black circle.
Notice that at this juntions it joins with the battery wire.
So all the wires connected at junction are always hot, even with the key off.
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When the key is in Run position, power is available in the J2 wire Ignition Run.
The Ign terminal on the voltage regulator is now at system voltage.
The regulator is like a switch. If the voltage is lower than the set point, the regulator closes the switch and electricity can flow through the regulator and the alternator's rotor.
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The spinning rotor creates an electromagnetic field.
The reaction in the non-spinning windings is a lot excited electrons.
When the regulator opens the switch, the electromagnetic field loses strength.

Still would like to know why Blue wire cut at alternator and connected to terminal at bulkhead connector was for or even went to.
So originally a blue wire was connected from the bulkhead position B to the ballast resistor, and another blue wire continued on to the voltage regulator.

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Does this make sense?

Put some more photos up in the other thread or this one.
Since you've already unwrapped the harness tape, I think the best will be to replace sections of multicolor with new. But before jumping in, it would be best to see how the electronic ignition box and ground controlling regulator are wired in and located.