I just totally ripped apart my magneto and what I found was this the bulk of the thin gauge wire is the blue wire connected to the ground and the white wire. The first part of the windings like 5 layers (a layer of tape separate them) is the white wire a thicker gauge than the blue it is connected to the ground and the blue wire. So both the blue and white have a common ground. The rest of the layers (no separation of the layers) blue is just spun anyway the person who did it felt like.
Pictures below
White wire
You can kind of see where they are all connected in this pic
You can see the separation of the layers of the wire here and the blue windings most of it taking off (note their is a layer of tape between the white and blue layers).
I am going to rewind the coil and separate the grounds between the 2 that way their will be loss of power when I want to hook up light system to it. Their will be just 4 wires coming out of the magneto cover instead of 3. I will also get rid of the ground soldered to the magneto.
Going to radio shack now to pick up some wire.
empty magneto