The black wire coming off the starter relay is a negative wire. There should be another wire on the same terminal that connects to ground (engine block). The other black wire provides the ground for the bus terminal under the dash. Unlike auto's which has metal bodies, on boats a separate ground wire has to be ran to a negative bus terminal. On some, a separate black wire is ran directly to the battery negative terminal.
The ignition switch has two "M" terminals. Depending on your year and model, one "M" terminal will have the white wire which are coming off the CD modules. This white wire is the shut down wire, which when the switch is turned to "Off" position, shunts the two "M" terminals together. The other "M" terminal is connected to ground.
This ground "M" terminal can either have the blue or black wire. In your case, it should be the blue wire which by the way if you look at the terminal bar, it is actually connected through a bus bar with the black wire. So if you connect either blue or black wire to only one "M" terminal and the other "M" terminal to the white wire, you should be good to go.
You can also decide not to connect the black wire but instead use it to connect to a negative bus bar or terminal for ground.
The ignition switch works as follows:
"Off" - All terminals are open except for the two "M" terminals (closed to ground to shut down the cd modules)
"On" - Both "M" terminal are open, "B" and "I" terminals are closed. The "I" terminal may sound like it stand for ignition, but the truth it is the accessory terminal. All ignition switch powered accessories, like gauges, radio, depth finders, etc should be connected to this terminal. Normally, the "I" terminal is connected to a positive bus bar to accommodate all connections.
"Choke" (pushed in the switch) - In addition to the preceding, the "C" and "B" terminals are closed activating the choke solenoid
"Start" - closes the "S" and "B" terminals energizing the starter solenoid, which in turn closes a large contact to directly connect the starter to the battery, thus energizing it.