Well, it could be that the alternator is working perfectly and the load that is causing the fuse holder to melt is exceeding the charging system's ability to charge the battery. As suggested, do an amp draw test!
"The Commando does not rely on frame ground (that I know of) except for the old points condenser pack on the coil bracket, and that had its own wire."
Although I agree that one can correctly say that the commando does not rely on a "frame ground," I think it is misleading because the OEM wiring harness attaches to the head steady, NOT to the engine. Therefore, it is more like a frame ground than anything else. The points system was grounded to the engine, as are some aftermarket E-ignitions and, of course, the spark plugs are grounded to the engine. A poor ground to the engine can produce all sorts of curious problems so the practice of extending the OEM ground directly to a bolt on the engine is a more positive (NPI!) method.