All's well that ends well. I'd like to share my problem's solution with everyone. After making all the alterations noted above, while putting in a new Powermaster #9504, we discovered the wire from the solenoid to the starter was cooked. It wasn't obvious from a visual inspection. We replaced it and also ran a new positive cable directly to the new starter which has its own mounted solenoid. The old Ford starter was removed with just a removal of the header bolts on the one side. The new one slipped right in with no mods required. Hot or cold, the engine now starts on the first revolution! Can't say enough good things about the starter and the Powermaster service. Made in the USA, and Steve promptly returned my call (twice!) He even offered to take me on a tour of their facility if I was ever in the Chicago area. This whole starter experience restored my faith in American industry and American workers. Who would have thought?
P.S. I love this hobby. More challenging than crossword puzzles and you meet the nicest people. Shout out to Rocky and Larry for their help in the past.