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Derek - The wiring diagram is trying to tell you that terminal 54 is hot only when the ignition key is in the 'on' position. You need it to be hot also when the key is in the 'start' position, or the starter won't start the car. The diode wire allows you to make this happen without cutting the armored cable by tapping into a circuit that's hot when the ignition key is switched 'on' and also when it's switched to 'start'. The diodes are there to allow electricity to flow only in one direction - from the power source to the perlux (or crane, or bosch, or whatever).
The 'round' junction is just indicating a 3 wire connection.
Cast iron distributors are smaller in diameter than the aluminum distributors and there isn't enough room inside for the pieces to fit without interference.
Any aluminum B20 distributor will fit any B18.
Best,
Cameron
Rose City
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