Hooking up the battery with reverse polarity, connect the two battery terminals together at the rectifier. All the current available at the battery terminals (such as a car batteries' 600 plus amps) attempt to flow into that circuit. Since small diameter wires cannot carry that much current without generating heat, they make enough to melt the plastic insulation on those wires and any wires that are touching them. If left long enough the wires themselves will heat to their melting point. When they part to break the circuit, the event is self terminating. Since reverse biasing the rectifier basically connects all wires going to it together, the alternator stator wires (Yellow) Can also carry overcurrents that melt their insulation too, along with any bystander wires in contact.
The rectifier itself may be damaged as the Diodes aren't rated to handle such high currents. They may have fused (welded themselves together), opened, or even survived because some other circuit components in the current loop failed first.
Anyway, all wires between the battery and the rectifier (and the alternator stator), must be tracked down and visually examined for heat damage. All the connectors in the path must also be inspected for heat damage.
The Battery POS main cable is a larger gauge wire than most of the bike wiring as it has to routinely carry 120 Amps to the starter motor. The charging and bike electrical power are tapped off the connection point at the starter motor solenoid. From this point to the rectifier is your expected trace route and examination path.
Since current flows in loop, the Green wire path from the rectifier back to the frame connection up at the ignition coil mount must also be inspected/repaired (along with any wires making incidental contact and have their insulation damaged by the adjacent heat source).
The block connector that contain the yellow wires to the alternator stator, also contain wires for the alternator field coil wires, neutral switch, and oil pressure sender. If the Yellow wire insulation is melted, other wires in contact may also be damaged.
I don't know which wire diagram you are using. But, I recommend the one that is in the CB500/550 Honda Shop Manual (pg 145).
I repaired a bike with this type of damage a few years ago. (I bought the bike from a salvage yard.) It took about eight hours of work, and I had a spare harness to rob the needed color coded wires necessary to complete the repair.
