The AC voltage is measured between each of the yellows. It does not need any ground reference to do its job. The rectifier translates the ac to dc and gets a ground reference there.
Extremely rare for the stator to go bad (connections- yes, coils-no.). But, it cannot output unless provided with a magnetic field, which is the job of the field coil and rotor creating an electromagnet. To that end, the field coil needs to be provided a voltage to make it all happen. Look to the white wire which passes voltage from regulator to the field coil. Unless the battery is above 13.8V, this white wire should have full battery voltage on it.
Check and report.
Cheers,
P.S. I misinterpreted your voltage drop report earlier. I though you were reporting voltage drop across the key switch rather than a general drop of all voltage systemic with the key switch on, which is pretty much normal without an operating charging system.