I mounted the H-D regulator directly onto the steel plate without the rubber cushions. I used some oversized bolts between the regulator and the plate to give it an air gap. When I removed the original Cycle Electric regulator I checked the ground and it was perfectly fine. The regulator was very much dead and not just partially dead.
Have had a whole slew of Harley Davidson groups passing through here and have had a few conversations regarding this issue and they all agree that the stock regulator supplied by S&S (Cycle Electric) is a POS and should be avoided. The H-D unit is practically bulletproof and is usually mounted directly without rubber bushings. These guys just love the S&S but really looked pained by the regulator.
When I first read that (I only saw it after my second post in this thread), I thought to myself "But there has to be a reason for those rubbermounts - perhaps it will all shake loose or the innards might fail prematurely". But then I took a closer look at the pictures in the threads I linked to, and it seems that doing without rubber is the "done thing":
And in particular this image:
