SHARKEY-IMAGES

Engine: 1997 Merc 2.5 EFI Racing Offshore Powerhead.
Worst kind of trouble to find... Intermittent electrical problem. At least I think.
One time while getting on plane Engine @ 5000 RPM suddenly cut out. It started right back up and hasn't happened since.
Till last weekend, again around 5000 rpm but already had been running on plane the engine dropped off but didn't stall. Felt like cutting off the key switch and turning back on. Fuel pressure and head temp remained the same as it did it twice this time. I first looked at my switchbox wiring only to find the Red w/ White tracer almost chaffed through onto the White w/Black tracer. No copper showing yet but the insulation has been worn down almost to the copper. If this was to arc to the other wire or possibly ground, could this be my problem?
Also, I have the Dark Brown w/White tracer coming out of the wiring harness to the dash that has floating loose and isn't connected to anything. Could this also be a possibility?
If anyone has a Link where I can find a wiring diagram for the stator, harness, and switch boxes, that would be a great help.
I know I am probably in for alot of trial and error here.
Thanks in advance for any help!