Follow me here, this is the whole safety system in order of current flow.  It's a chain that starts at the side relay and ends at the decomp control.

Overview:
Battery > Ignition > Side Relay (ground by kickstand up and/or in neutral) > Kill Switch > Starter Switch > Clutch Switch > Decomp Controller > Starter Relay

Side Relay
I believe that they chose to wire three of the four wires orange to prevent tampering.  I'm going to use the Clymer as my reference.  From left to right:
ORANGE 1: 12V main power
ORANGE 2: round through either/both side stand switch or neutral switch
ORANGE/BLACK: 12V sent out to kill switch
ORANGE 3: 12V main power

When the relay is closed, current passes to the kill switch by connecting ORANGE 3 to ORANGE/BLACK.

The relay is closed when current passes through ORANGE 1 to ORANGE 2, whose connection to ground is interupted by the kickstand switch and the neutral switch, both of which are normally left open. With no ground, the current sits in ORANGE 1 and ORANGE 2 (more accurately, there is no current.)

If either or both switches are closed (putting the kickstand up or being in neutral,) the ground is completed and current flows from ORANGE 1, through the relay, through ORANGE 2, and out through one or both of the "grounding" switches.  This movement of current closes the relay between ORANGE 1 and ORANGE/BLACK and allows current to flow to the kill switch.

If you want to eliminate the relay and side switch: Connect ORANGE/BLACK from the kill switch directly to power. Remove Side Relay and kickstand switch.  ORANGE 2 will need to be removed from its connector to the incorrectly labeled"side stand diode" which is actually the [i]neutral light diode, which you will need if you want a working neutral light.[/i]

Kill Switch
ORANGE/WHITE- 12V sent to starter switch, ignition coil and Ignitor
ORANGE/BLACK- 12V in from side relay

Pretty simple. ORANGE/WHITE splits off to power the starter switch, ignition coil and Ignitor.  When the bike is running, it needs constant power to the Ignitor and ignition coil.  Cut the power to these, no more spark.

Starter Switch
Normal
YELLOW/WHITE- 12V sent to horn, pass switch
ORANGE- 12V main power (for horn, pass)

Pushed
ORANGE/WHITE- 12V in, sent from kill switch
GREEN/YELLOW- 12v sent to the clutch switch

If there is a current through all the previously listed components, the starter switch sends current to the clutch switch

To Simplify (if you move the switch): Disconnect YELLOW/WHITE and splice into main power.  Ditch ORANGE.  

Clutch Switch aka Clutch Lever Position Switch
GREEN/YELLOW: 12V sent from starter switch
GREEN/YELLOW: 12V sent to decomp control

This is a simple switch.  It just prevents starting with the clutch lever out.  This is done because the current can reach this far as long as the kickstand is up. (see side relay)

Decomp Control
This is where everything really happens.
GREEN/YELLOW: 12V in, sent from safety circuit
RED/BLACK: 12V sent to trigger decomp solenoid
RED/WHITE: 12V direct from battery (through 20 amp fuse)
YELLOW/BLACK: 12V sent to trigger Starter Relay
BLACK/WHITE: Ground (duh)

Once we get a current from all the aforementioned gizmos, the decomp control fires. It does two things:

1) trips the starter relay
2) fires the decomp solenoid for a split second to prevent a starter vs compression stroke showdown.  (Ill give you a hint: starters  lose)

To remove and switch to manual compression- wireclutch switch output (GREEN/YELLOW) straight to the starter relay (YELLOW/BLACK).

Starter Relay
RED CABLE: 12V (high amps) from battery
BLACK CABLE: 12V (high amps) sent to run starter
BLACK:  12V sent to signal CDI to change timing for starting
BLACK/WHITE: ground for solenoid switch
BLACK/YELLOW: 12V sent from decomp control to trigger solenoid

Current passes through the relay from BLACK/YELLOW to BLACK/WHITE, tripping the relay and connecting current from RED CABLE to BLACK CABLE and BLACK.  BLACK sends a signal to the CDI, telling it to change the ignition timing for starting.

To simplify: stick a screwdriver between the poles... or just jump your starter to your battery.  (I do not recommend this unless you really know what you're doing has a purpose)

Ignitor- that little black box
ORANGE- 12v out (in?) to pulser
GREEN- 12v in (out?) from pulser
BLACK/YELLOW- 12v ground from primary ignition coil
BLACK- input signal from starter relay
ORANGE/WHITE- 12V sent from from kill switch
BLACK/WHITE- ground

The Ignitor is the most misunderstood part of the bike.  It's been a mystery to me until I unravelled everything else.

The Ignitor receives power from the safety circuit via the kill switch (to prevent it getting power when not running.) This power is routed into the pulser.  At the moment I am not sure of the polarization of the pulser, but I assume that orange is hot and green is "ground."  The pulser picks up the movement of a magnet on the flywheel and computes the best spark timing based on the engine RPM.  BLACK, a cloth covered wire from the starter relay, simply sends current to the Ignitor to somehow adjust timing for the starting cycle. It may retard timing, it may actually prevent spark for a duration. It sends current for as long as there is current flowing into the starter through the relay (as long as you are holding the starter button.)

When the Ignitor decides to fire the spark plug, it cuts the BLACK ground from the primary coil winding.  When the ground is no longer open, the magnetic field in the coil that has been built up by the current flowing into the coil through ORANGE/WHITE (the one that current flows into via the kill switch) collapses.   This collapsing field gets electricity excited and sends it rushing to the nearest ground- the spark plug.  Boom.

When the kickstand is up, you can start the bike when it's in gear.

The clutch safety is the only thing preventing you from engaging the starter while in motion.

Could be a good thing, as starting a rolling bike that's lock up the rear trying to get thru the compression stroke sometimes can't be done.  A little blip of the starter will take care of that.

verslagen1 wrote on 01/07/10 at 21:43:27:

I just remembered a time when I had the original battery, the bike wouldn't bump start, it would just skid the back tire.  I could have used that little blip... DENIED by the clutch switch.  

Thanks for the answers guys, and good summary of the electrical system.

Bobbert,
 Fairly nicely done.  

An addition to the interlock circuits is the side-stand realy and the side-stand diode that does the mysteries of ground "sinking" when the nuetral switch makes contact and isolation when it does not.

The factory service manual describes it farily well.  Here's a pict.

Safety Circuit