The Delco SI type alternator is self-regulated, and really only needs a jumper wire from the big Bat. terminal to the #2 connector at the regulator, the one on the left as you look at the rear of the alternator. You can route that conductor through the ignition switch if you want to open up the circuit with the engine stopped. The #1 terminal, the one on the right, is for an idiot light, if you choose to use one. Otherwise, don't connect anything to it, and definitely don't ground it. If the indicator light is used, run a wire from ignition voltage to the light, and run the ground side of the light to the #1 terminal. The light will illuminate when the alternator's not charging, such as engine stopped, switch on, and it will go out as the alternator begins charging the battery.
Jerry