70 C20 w/HEI Starter Stays Engaged, Ignition Switch Smoked

[CW4B]

Just bought, pretty rough. Just trying to get it running safely for now.

Got it running after fluids and brakes and drove it home. Replaced HEI distro cap, cables, plugs.

Started and ran but with loud screeching noise (that wasn't there before). Pulled plugs & cranked, starter seemed like it was not disengaging when I moved ignition switch back to "ON" position.

Removed & had starter tested, tested good. The solenoid spring seemed to throw gear out and it would pop back in smartly. Manually moving gear in and out with screw driver indicates smooth action and springy spring.

Attempted to check starter shim. Couldn't figure out how to manually engage starter gear (no room to manually actuate starter gear), so I double shimmed from 1/64 to 1/32 as a starting point (trial an error method). Otherwise, flywheel teeth are good and starter gear wear indicates it is engaging fully, which is about 3/4 onto flywheel gear. Has correct bolts and block looked straight with no damage to thread holes.

NOTE: Starter had 3 wires, including an R & S. Reinstalled wires to previous locations (I am pretty certain) but subsequent study leads me to believe I shouldn't need an R wire with an HEI conversion.

Reinstalled plugs.

Started, starter not disengaging still. BUT new symptom. While I was pondering my decision to buy the truck, I left the ignition in the "ON" position. I smelled something electrical burning. Checked the starter connections, felt like the S connection was getting warm. Then saw cab was filled with smoke. Disconnected battery and then searched for source of smoke. Purple and two conjoined brown wires melted where they enter ignition switch.

Disconnected the R wire from starter and taped. Started again, same smokey problem.

Not sure what to do next?