The ignition box always has full battery voltage. The switching transistor does all the sinking. These were commonly known to be MJ10012's. [ame]http://www.nteinc.com/specs/original/MJ10012.pdf[/ame]
The power transistor can handle it. I doubt at the ignition box will have to sink more than 7A.
It's to protect the original style coils only. In a points system it was needed to keep from burning the points as well.