.......It is tight against the firewall. But those holes seemed stripped out to me.
1. Okay, the test with engine OFF from the POS battery to the blue wire...Is that taking the blue wire OFF the alt and check it there at the end of the wire?
If the regulator mount bolts are stripped, that is probably the problem. The regulator must be grounded to "same as battery negative" and it never can be if the bolts won't tighten, and if the bolts won't tighten, it's unlikely that a good electrical connection is made. Do whatever it takes, use larger bolts, weld up the holes, etc.
No, don't remove any wires when doing this test. What you are trying to find out, here, is if there is a "voltage drop" (simply, a loss of voltage) on the "road" from the battery, through the harness, and to the regulator. the blue alternator wire comes from the same place as the regulator blue wire, that is, the "ignition run" buss on the switch side of the ballast.
So by accessing an "easy" place with your meter, and the battery positive post, you are directly measuring this voltage drop.
..........2. I am sorry I don't know what you mean here exaclty? The second check is to stab into the Regulator flange? I have two wires going to the regulator?
This may be hard to swallow, but once again you are checking for voltage drop. There is a "circuit path" from ACTUAL ground--which is specifically the battery negative POST. EVERY other ground connection, if "good" should be at this same voltage
Let's sidetrack.............let's say you are cranking the engine. The starter ground path is...........
Battery neg post----battery clamp-----battery ground cable-------to engine block---to starter housing-------to starter internal winding "ground."
Now since the starter is a high current load, this can cause a LOT of voltage drop if cables, clamps, terminals are not tight.
So to check the starter ground path, example, you could stab one probe of your meter directly onto the battery neg. post. Stab the other probe right onto the engine BLOCK. The fact is, that the ground PATH described above WILL have some voltage drop. Probably the greatest will be right in the post--to battery clamp connection. But you can MEASURE this with your meter.
In fact you can do that and try it. You should show less than .4V (4 tenths of one volt) and "good to great" would be less than .3V (three tenths of one volt.)
BACK to checking your regulator ground. You MUST have CURRENT to cause voltage drop. So in the case of the regulator ground, the system must be charging. In this case, the ground path is............
battery neg. post-----battery clamp-------cable--------engine block------jumper from block to body/ firewall------regulator mounting bolts--------regulator case/ mounting flange
OR alternatively, if you have a jumper ground from the battery to the fender, the path is...........
battery neg post-------battery clamp---------fender bolt or radiator support-----through the body to firewall---------regulator bolts--------regulator case/ mounting flange
Now your meter is going to measure ACROSS the first and last points in this "Map", this road to the regulator.
So again, with engine running and charging, you want one meter probe right directly on the battery NEG post, and the other right on the metal mounting case/ flange of the regulator.