Yes, you are right. The red wire from the battery should go to the battery terminal on the new generic switch. The wire from the solenoid obviously goes to the solenoid terminal. If there are only three terminals on the generic switch, then everything else, including the coil, will go to the accessory terminal. In the original switch, only the coil and the starter get power when the key is in the "start" position. When the key returns to the "run" position, the coil and all of the accessories get power. Presumably, the generic switch energizes the accessory terminal and the solenoid terminal when the switch is in the "start" position.
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1966 122s, 1968 142s, 1969 144s, 1979 245dl, 1989 244gl