mine has no diode that i am aware of. i also dont see one on the diagram.
the brown wire at the ign switch is connected to the fuseblock. from the switch it goes to terminal B on connector, and splits off to the dash printed circuit.
from terminal B, it goes to the regulator.
basically, it is connecting power to the charging system from the ign switch. the charging sytem doesnt just work because the engine is running. it needs to be activated by the brown wire from what i am seeing here (i hate wiring). i can make my car run by jumping the coil and the starter, but it wont charge that way, or turn the light on.
if you dont like the light, you can cut the wire to the printed circuit, or just remove the bulb.
other side of connector. terminal B to ign switch and wire E to dash printed circuit. http://1968firebird.org/68wir/68wir3.html also showing connection to fuse block. acc is powered with switch on.
internal conversion showing brown connected to blue. (yellow on ours is black) http://www.chevelles.com/techref/tecref14.html even with the internal conversion, it still has a regulator, and the brown wire still connects between the ign and charging system. a conversion wont solve the problem, just allow a higher amp alternator.