Burned bulk head connection

the ballast resistor is modified to let 12V going through (got it from halifaxhops)
well then it prob has an HEI module in the ECU. Those modules control current internally. Best thing with that is ask @halifaxhops.
Don't think that's related at this point.

If I just replace the black alternator wire, would it make sense to add a fuse or other safety feature in it, just in case the wire gets too hot?
Not on that wire. The question is why did it get too hot.

Here's the wiring diagram reduced to the power and run circuits.
The location you're seeing showing overheating is P, and so far no where else.
upload_2020-2-18_22-20-3.png

All I can suggest from that evidence is a bad connection at P.
If the battery was either drawing or providing a lot of power, we'd expect to see similar damage at J.
Also you probably (hopefully) would have noticed the ammeter spending a lot of time away from the middle (zero) position.

Maybe it would help to discuss what the drawing above shows.
If the engine is off, key is off, all of the wires connected to the battery's positive post are at battery voltage. Lets call it 12.8 Volts. No current is flowing.

If the dome light or parking are turned on, current will flow through the battery feed, through the fusible link and the connector, through the ammeter to the fusebox and eventual through the lights and back to battery negative.
The current flowing through the ammeter will cause the needle to deflect showing discharge.

With the engine running the alternator can produce power at a higher voltage than the battery. So instead of the battery being the power source, the alternator is the power source. In fact, if the battery is low (such as after starting) is will draw current. When current is flowing to the battery, the ammeter needle will deflect toward charge.
upload_2020-2-18_22-51-17.png
It doesn't take much power to run the ignition and alternator field. Showing 4 amps in this example.
Battery charging will draw less and less current the closer it gets to fuller to fully charged. Showing 8 amps in the illustration. The gage is roughly 40 amps to 40 amps. If you see over 20 amps for any length of time - there is a problem and need to figure out why.

Even without the battery charging, if you're driving at night or in the cold and rain, the current drawn by the lights, wipers and heater blower adds up.
Light are about 9 amps plus parking and instrument panel, lets say 5 amps to the wipers and 5 to the heater fan on low and now its up to 27 amps.

upload_2020-2-18_23-15-3.png


The connection at P is the weakest junction in the alternator output line. It's possible it was just not making a good connection or either terminal didn't have a good crimp. The heat is generated by current and resistance. More of either and the more heat will be generated.
Its also possible something is drawing more current than normal. This could be because voltage is regulated too high, but then we'ld expect to see other signs. To be safe, it wouldn't it hurt to check running voltage at idle and fast idle or 1250 rpm.

Running a parallel wire through a grommet to the ammeter does two things.
1. If the battery needs charging, that will be the shortest path. Current for recharging will not go through the bulkhead connector but directly to the ammeter and then to the regular charge path.
2. If there is excess resistance through the bulkhead connector, electricity will take the parallel wire with less resistance.
upload_2020-2-18_23-28-4.png