[Flip]

Yes I can see that- just looking through the schematic of my 1997 900 and it's there across the solenoid terminals and I can see why it could be on the blue wire (assuming it is the same of course but we all know what assumption is) from the light switch as that is directly from the 7.5A fuse D4 (turn signals, side, tail and warning lights) and then there is a return wire from the light switch back to the ignition switch where the side light circuit (with ignition on) picks up from the Parking light circuit (steering lock on).

But crucially there is the wiring from the ignition switch through to the General Relay, Fuses, Battery and Starter Solenoid (and obviously going to the Starter and Kill switches) which is all live with the ignition on thus the reason for the diode to protect it all.

You can also see from the schematic why (although it seems to vary bike to bike) that the General relay arcs so badly (speeding up its' demise) from the charge in the coils when you switch the motor off using the key.

Whereas using the kill switch to stop the motor running prevents this while the switch contacts remain unaffected.

If you're intrigued by that, prise the yellow cover off the relay and see if the contacts spark over when you turn the motor off with the key, then try it again using the kill switch.