I have a Pertronix I in my original 1970 distributor. After testing via the pertronix instructions I have 6.4 volts with the key in the "on" position and 1.9 ohms in the stock style coil.....I assume its 1.5 ohms.

The 6 or so volts you see with the key on is about correct, for a point style system. The other wire you cut, the yellow one, is probably the 12v supply from the starter solenoid. It is designed to provide a full 12 v to the coil when cranking, for a quicker start. Once the key is returned to the "run" position, the voltage for the coil/points now comes from a resistor wire, which drops the voltage to right around 6 volts. SO...you have a correct working system...IF you still had points. I'm not up on what the Pertronics system requires, but since you've basically done away with the points, you should be able to run 12 all the time at the coil, but...I would buy a different coil to use, instead of the factory type coil. It may not be up to having 12v run thru it constantly. Does Pertronics  recommend any other coil, or a coil change at all?

They recommend their Flame thrower, but only because you get more spark not because you have to.  I will attempt calling their tech line.  

I have read several posts from other sites and the limited instructions available from pertronix website and it dose not mention cutting any wires from the original harness, so maybe I shouldn't have cut the yellow wire.

IF the yellow wire is in fact the bypass from the starter solenoid, it will have no effect on the idle quality, or anything other than the actual starting/cranking voltage. Once the key is released to the "Run" position, the yellow wire would be dead, voltage-wise.
I don't have my wiring diagrams loaded back onto this computer yet, so i can't check that, but I'm fairly certain the yellow wire is the bypass.
Splice it back in, and see if it makes a difference...
You might need to do some sparkle-plug checking...see if the plugs are in good condition, and maybe even open the gap up a little.

I did test the yellow wire in the "on or run" position and it is dead, so you are right, it is live in the start position.  I think my problem is I only have  6 volts when the system is running and it needs 12v.  I am going to run a bypass 12 volt source to the positive side of the coil and disconnect the resistance wire completely. I will probably need to replace the coil too, since it is a points style coil and may get too hot with a full 12v.

It's a shame Pertronics doesn't give you more info on this...

run a wire from the fuse box, there is a switched 12 volts spade, you'll find it with a test light, if your worried about someone stealing the car run a toggle on-off switch in that line and hide it somewhere. anips2009-08-18 16:23:11

I disconnected the resistance wire (along with the yellow) and ran a wire from the fuse box "ign" spade to the positive side of the coil, and it fired up quicker and has a better idle.  

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Adams' Apple2009-08-18 19:45:36

  Kewl!
 Keep a check on that coil...touch it and see if it seems to be getting waaay too hot after the engine has been running for a few minutes. If it doesn't get so hot ya can't touch it, you may be good to go, but it wouldn't hurt to have a spare on hand, just in case.