Voltage regulator location? Need a new alternator?

Ok this is gonna be a long one...

So I put the alternator back on, but had to run out to the auto parts store this morning and asked the guy about a new VR. $14.99 Hell yeah, why not. So picked up a new VR. Got home and ran some voltage tests as suggested...

Battery - 12.7 V
Battery at idle - 13.6 V
Battery at 1500 RPM 15.3 V but steady

Tried doing the IGN to POS with Key in Run and it was all over the place. Upon further inspection the old VR was all corroded, connections frayed and protective cap was basically hanging off. Figured might as well change that out. Changed out the old VR for the new one and ran the tests again.

Battery - 12.7 V
Battery at idle - 13.6 V
Battery at 1500 RPM 14.8 V but steady

IGN to POS, Key in Run - 1.8 V
NEG to VR Mount - 0.003 V
Neg to VR Mount with Headlights etc. On - 0.008 - 0.012 V

The new VR did not solve the problem, but I'm glad I got to change out those connections. The problem is more consistent now though. Where as when I started this all the lights (tach and volt gauge) would pulse in and out when bringing up the RPM... now when I bring up the RPM the tach and volt gauge cut straight out.

While I was under the hood and tracing lines I was checking connections and such and with just a brief look I found 2 wires that had significant cuts in the insulation, exposing the copper. Could this attribute to the problem? Also, as people have mentioned the tabs on the back I will post a picture of the wiring in the back of the alternator before I removed it in the first place.

Alt wiring.jpg

I just want to add, I really appreciate everyone spending time to help me out. This is my first classic car, and I want to try to do as much work to it myself though I lack the experience. My goal here is to learn and improve. Thanks again for sharing your knowledge!