The GM coils are not designed to run full time on 12 volts like the HEI distributors, so the pre HEI ignitions used this wire with a resistance built into it to reduce the 12 volts from the key switch down to 8.5 to 9 volts for normal engine running. The engineers realized that it would be better to start the engines with a hotter spark so they tied into the yellow wire from the starter solenoid to provide a full 12 volts to the coil when starting.
With the introduction of the HEI ignitions the resistance wire and the yellow wire were no longer needed so they removed them on the 74 models. A lot of the guys when they make the conversions to HEI use this wire and soon find out that their trucks don't run very good and don't relate it to the lower voltage that the resistance wire provides. That is why a new wire needs to be run from a keyed full 12 volt source such as you have. It is possible to just remove the resistance wire from the bulkhead connector and run the new wire from there since it is 12 volts ahead of the bulkhead connector.
Here's a couple of diagrams for the readers. The first one shows the stock wiring and the resistance wire is orange/purple from the bulkhead connector and where it joins the yellow wire that goes to the coil.
This is the HEI wire
