Sears 3600 Watt Portable Generator

Motor (electric) Gurus please help if you can!
I lost one of the two outputs of my portable generator yesterday. Today I opened the thing up and found the control panel breakers and outlets appear to be good with expected continuities and clean, tight connections.
Moved on to the motor and right away found the red lead from the bridge rectifier pinched with the insulation worn through and shorted to the case by a cover bolt. Everything else appears just fine and I detect no indication of anything burnt or hot electrical odor.
I repaired the red lead, nailed back together, and it made no difference.
Pulled the cover back off and removed the bridge rectifier/brush assembly.
With my limited electrical knowledge I believe the bridge rectifier is good as my test light lights in only one direction on each diode.
So if I follow the red lead around the stator it terminates in this black insulation. I am thinking there is a thermalfuse inside. (?)
Is this the next logical culprit?
Where do I go from here?
TIA, Dave