I can't tell you why the smoke came out, but your description of the
connections is correct. It should have worked OK with the ballast
resistor in place as you described. Could have been a bad part; could
have had dirt on it (hope hope). If you have an ohmmeter, it should
have a resistance about 1.5 or 2 ohms (almost, but not quite zero
resistance.)
It is possible that the points got welded by operating with no ballast
resistor (that is what happens; the resistor is not there so the
current is less limited, so the points carry more than they are
designed for and overheat and stick). If operated for an extended
time this way, the coil may overheat and fail; the points will
definitely fail much sooner with no ballast resistor.
The purpose of the resistor is to allow full cranking battery voltage
(8 volts or so) to be applied to the coil during cranking, (the
resistor is bypassed during cranking) but to limit the voltage applied
to the coil while running. (The battery is now up to 13 or so volts;
the resistor drops some of that so that the coil is still operating at
about 8 volts.) It does this by "resisting" the current flow. Much
like a restriction in a pipe resists fluid flow.
Hope this helps.
Donald.
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