You were Right.
This is my Dad's bike and he wanted me to change as little of the wiring as possible. I connected the r/r to the old wiring. I noticed an improvement from cold, but as the bike stayed on and warmed up, the level of charge decreased to the point of not charging (by the end it was at 11.7 volts @ 3k rpm) The stock wiring was extremely hot to the touch. The wires are tiny in comparison to what came with the r/r. I think they get so hot that the resistance in them goes up, limiting the current through them.
I wound up connecting the r/r directly to the stator using 10 gauge wire and did the blue wire mod. I get 14.5 volts from cold to warm up, then it goes down to 13.2-13.5 when the cooling fan kicks on and stays steady there. The bike runs pretty hot, so it may need a tune-up/carburetor cleaning and adjustment.
It doesn't seem to have any trouble starting with the headlight on, but I was considering adding a toggle switch just in case he ever had trouble starting the bike.
Thanks for the update. The JB is black a hole that absorbs electricity, electrons check in, but they never check out. We should call it Hotel California. Roach Motel?
Sounds like your volts are right up there, some drop is normal during fan operation, yours is right where it should be. If it's not running lean, a cooling system flush/clean may be needed for the temperature problem.