No Power to Sparkplugs. Any advice appreciated

Hi, I recently bought a project boat with a 1983 mercury 115 on it. I’ve been slowly working my way through fixing it (new water pump, gearbox fluid, hydraulics refill, new key switch, new fuel lines) but have now come to a real problem. I’m not getting any power to any sparkplugs whatsoever. All the other electrics on the boat have worked well so I was a bit shocked by this. I thought maybe it was the killswitch so I just cut that black and yellow wire to eliminate that. No luck. Now I’ve been testing the resistance of all the different colored wires on the motor per what I could find online. (Don’t have a manual). They all seem to read properly, but I have one set of wires that the insulation has completely crusted off and the wire looks corroded (picture below). These read basically no ohms going from their nuts to ground. This seems like an obvious problem to me so I’m trying to replace them. But, for the life of me I can’t get the flywheel off. The nut is so tight and seems to have red loctite on it. The boats at my buddies house so I’m going to go tomorrow with a bigger breaker bar and a heat gun and see if I can get it. This leads to my questions:
1. What even are these wires for (I can’t tell their colors they’re so crusty)
2. What’s the thing they’re connecting to in the picture? The thing to the left of the starter is what I’m talking about
3. Is it possible this is what is causing my issues. Basically should I get my hopes up if I can get the flywheel off?
4. Any advice at all, this is my first boat and I’m just trying to learn and maybe I’m making some dumb or common mistakes.

The thingy ( rectifier ) with the 2 yellow and a red wire has to do with charging the battery.------So charge the battery.-----Take the starter apart for inspection and ohm check on armature.-----Have battery load tested.-----If starter turns flywheel too slow there will be no spark !----You need a puller that threads into the flywheel.-----Have your local friendly shop pull it for you.

Red Loctite ??
The last person did NOT tighten the flywheel nut CORRECTLY. DO NOT try to remove the fly wheel. The key under the flywheel is severed so bad that no spark is on time to run the engine.
DO NOT attempt to repair the flywheel in any way. You can only make it more expensive. Good Luck.
You need a mechanic who has worked on old 2 stroke engines.
That thing is probably the battery charging rectifier. The wires prove that a HUGE OVERSIZED fuse is in the protection circuit of the rectifier. DO NOT Try to run the boat with a battery. With the damage done to the rectifier & wires. The charging coil under the flywheel should be RUINED and need replacement.
You can reconnect those 2 safety switch wires now.
That motor should have enough problems to make you a decent DIY engine person.
See if you can find the Fuse that is supposed to protect the Charging Coil. It may have copper wire wrapped around the fuse posts it that is possible.
I can not remember the great marine supplier of old motor parts. With parts diagrams for many years. It is www.crowleymarine.com

On that ignition system, the magnets on the flywheel swing past the stator inducing voltage to the rectifier and the two switchboxes directly under them. The rectifier only charges the battery. The trigger under the flywheel tells the switchboxes to fire the coil and spark is produced. Voltage to the coils is not continuous. A service manual would be good. Also, the CDI electronics web page may have some help for you as well. They sell replacement parts and want to help you diagnose the ign system.

The insulation on the yellow wires to the rectifier look like they may be shorting to the starter. Disconnect them from the rectifier and wrap 'em with electrical tape to insulate them for now. Since they share part of the stator, then could cause spark issues.

Remove the spark plugs and put a timing light on the spark plug leads and crank the motor. If you see spark, then the system is working. Checking the timing would be next.

Hope you solved your problem by now. I may have missed something, but have you checked the kill switch. I had the same problem on my first project boat. Doubled checked everything. Then realized the kill switch was off.