1966 Valiant Engine wiring harness

If the battery is around 12.5 to 12.8 Volts with nothing on, its usually pretty good.
Its likely then that there is a poor connection between the battery positive and the main splice.
Or, possibly poor ground connection.
The battery terminals don't look great in the photo, although its hard to see. So maybe thats a good starting point.

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Arrows represent current flowing. Another way to think of current is electrons moving.
There's no current flowing to the headlights, so the drop in voltage isn't occuring in that circuit. It has to be occuring before the main splice.
Voltage only drops when the electrons have to squeeze through resistance.
Although its also possible the two grounding points used are not well connected.