Why are there two positive leads coming from the rectifier? I have studied the schematics in my Clymer manual and both leads seem to connect together when the ignition switch is in the ON position. What is the reason for this? This is the case for the 1995 electrical system. In the 1994 schematics which looks a bit simpler the same is true but it looks a bit different.

The reason I ask is that I am trying to get rid of the battery box and I would like to install a LiFepo4 battery instead of the lead acid type normally used but to do so I was hoping I could separate the electrical system so that all light run directly from the rectifier and that the LifePo4 battery is only used as starter to the starter relay, starter motor and maybe ignitor module but it looks harder than I thought so separate everything.

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To answer my own question I believe I can adjust the charge voltage to the new battery at the position marked with a big arrow in the picture i borrowed from http://suzukisavage.com/cgi-bin/YaBB.pl?num=1294779818. The BMS (battery monitoring system) shunts up to 400mA or 1000mA on the two BMS-modules I am looking at when voltage is above 3.5V per cell or exactly 14V for the entire pack of cells so I need limit voltage a little bit. As soon as my engine is up and running again I will check the voltage from my regulator to figure out how much voltage I need to drop at the current of the BMS modules I decide on. I just hope I don't get unregulated power from another part of the circuit...

14 volts is a normal output of the regulator , the voltage needs to be higher than 12v(a good battery will charge to about 12.5-12.7) to recharge the battery, and  Verslagen is right,  the MASS of the battery dampens voltage spikes , which can occur when the regulator is switching 1/3  of it's load(3.3amps?) in and out at a time, and  damage things like your TCI  which doesn't like to see voltage over 14.5v max.