That green wire in second pic. Is that the wire from the distributor points? If so, it goes direct to the switchgear. On the diagrams you used, the green wire went to terminal where you attached the black wire and that was correct for car wired that way. So we need to look at wiring diagrams with later switchgear and determine where the black wire can be easily connected so it goes to same place as the points green wire. OK, according to attached diagram below, the black wire from Pertronix should go to center pin of terminal 7 of the switchgear on your W116.

The Pertronix II info says it must not be used with the original copper cored plug wires. Link III says to use model 1885, the original Pertronix Ignitor that does work with copper cored wires. It can be burned out if the key is left on with distributor in just the wrong position (does not happen in normal iuse). Pert II apparently protects itself against this. But just how, I don't know. No experience with it. Maybe you could swap Ignitor II for an Ignitor I?

First step is to get car running again with points. Make sure points are set properly - A gap of 0.014" is a good start (should be checked with dwell meter)

Attached Thumbnails

 

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Graham
85 300D,72 350SL, 98 E320, Outback 2.5