I think that I have solved the problem.
The light switch was burnt and had erratic connection because positive input was burnt until loose.
The light switch was burnt because the ground was failing due to corrosion at the battery plate.
The 1st day of inspection I suspected this to be the problem but I wrongly tested the wire. I tested the wire before it went to the bolt. Where the loop and connector was bolted to the frame. I had a test on the bolt and could get a 0.00 reading but was difficult mostly not 0.00. Lack of knowledge lead me to believe that this was still good but could not unbolt the bolt due to it being locked in and could not remove and fear of breaking off the bolt if I twisted to hard. The bolt still won't come out and been soaking with sea foam for days.
So I continued testing and inspecting the wiring. The first mystery was why I was getting 10 volts on white wire and 3 volts on yellow (or vise versa) at headlight plug. Some times I was getting 8.4 and 8.2 or 9,?? and 9.??. and not getting full voltage at headlight.
When I tested lights by removing fuse for either high or low beam I was still getting voltage on the other circuit.
I was also getting dim power to the lights I had installed to the loader arms when that fuse was not plugged in.
I did not understand the Diode box and that added to my confusion where I could not completely follow all of the wiring.
I noted down all of my tests for each wire with switch plugged and unplugged, removing fuses, removing diode. I could not figure out what I was seeing and discussed this with a friend who had experience in searching wiring problems who stated that the most common form of wiring problems was in the ground connections. He said that improper ground will send power through the ground to other circuits in search for complete ground. My installed lighting had good ground so the circuits would try to feed through those lights which had created the biggest mystery and I suspected the diode system (wrongly).
The problem was that I was getting to much heat on the wiring which was due to corroded ground.
I went back to the tractor and spliced a new ground to the headlights and this solved all the problems except for the burnt switch which needs to be replaced. I have not installed the diode block yet and need to check if that could be damaged by the faulty switch but I don't think so.
The other problem was that I am running to much load through the light switch. I will rewire my lights to a relay and fused power.
Thanks all for your help and hope that this will help the next guy.