Help with Electrical Gremlins Pls

Hey guys/gals.

I'm in need of some guidance. Electrical has got my brain wires crossed. I have a 1982 xj550 that's been modified:
Chopped rear end.
Ape handle bars.
Custom exhaust
TC Bros smaller turn signals ( not LED )
TC Bros Vintage Tail light / license plate ( not LED )
TC Bros DIY sissy bar.

Deleted the right hand ignition assembly (run, kill switch etc).
Deleted the kick stand switch.
Installed a starter switch from a boat (like an airplane toggle switch) underneath the tach'.

Everything worked great for a few years...

Recently, when I turn the key on, the headlight and meter lights don't light up anymore. If I unplug the Regulator / Rectifier and reconnect it (a spark happens in the casing) everything comes back on... Hi Lo beam indicator, Headlight, Meter ... and stays on even if I disconnect the Reg / Rec. I noticed that if the connector that goes from the Regulator / Rectifier to the alternator (brown and green) is disconnected then the previously mentioned procedure doesn't work. The lights do not come on.

I have a spare Reg / Rec, and tested it. Same result.

I have the wiring diagram for the bike. Tested continuity for the toggle switch, ground is all good. The ground for my battery is also solid. The bike fires up / runs well. I can't figure out why sparking the Reg / Rec connector causes all the lights to work.

All fuses are solid too.

If anyone can help that would be greatly appreciated. I've spent hours testing and cutting open the harness (extremely carefully) where the frame has warn into it exposing wires. The wires are ok. And I took a metal file to the burs on the frame under the tank to make sure it doesn't get worse.

I'm fishing blind with no worms, it's a struggle. (I don't even know if I'm casting into water...)

 

"Recently, when I turn the key on, the headlight and meter lights don't light up anymore"
start here
Clean and lube the ignition switch

do you have a photo of the reg connector.
sounds like a poor connection in the connector
if it is sparking that is a contact when it is making a connection I would suspect that the connection fails then when it is made again you see the sparks.

 

Thanks. I opened up the ignition, cleaned and lubed. There wasn't any signs of bad connection.

Here's a pic of the connector.

 

red wire is power to bike and brass contact looks like it is melting through the connector.

you can buy the connector bodies from @chacal the blades can be pulled out by sliding a larger sewing needle down the slot and releasing the lock tab.
he also sells the metal connectors if those need replacment.
clean the contacts with electrical contact spray cleaner