No worries, jags; you've got it right.
This fellow has simply used the bicycle frame as the ground-return path for his ligting so he has just a single "hot" wire running to the taillight. Though this used to be considered "conventional" for wiring dynamos, it was found to be ultimately less reliable than a two-wire design as you have. Why? Well, if you use the frame as a ground-return path, every single connection becomes suspect, rather than having a direct return via wire. Too, there were problems with the old method, such as some headsets not reliably passing current from the fork to the frame.
Best to go with a two-wire setup or a single coaxial setup (which is simply two wires in a single sheath).
Best,
Dan.
