1- We have seen plenty of equipment destroyed by reverse polarity despite the correct size fuse being used. We have also seen plenty of equipment destroyed due to voltage transients, where the correct size fuse was used, and never blew but the equipment was destroyed. Why? Because fuses trip on over-current not on over-voltage. The situation where a fuse sized to the manufacturer recommendation matters most, is on a bilge pump, where a stalled rotor can actually start a fire if the fuse does not trip.. The fuses or breakers are there primarily to protect the wire from the massive amount of stored energy in the battery bank.
2- ABYC standards suggest that 16 AWG wire is the smallest allowable "conductor size" and 14 AWG was used.
"11.14.1.1.2 Conductors shall be at least 16 AWG.
EXCEPTIONS:
1. 18 AWG conductors may be used if included with other conductors in a sheath and do not extend more than 30 inches (762mm) outside the sheath.
2. 18 AWG conductors may be used as internal wiring on panelboards.
3. Conductors that are totally inside an equipment enclosure.
4. Conductors on circuits of less than 50 volts having a current flow of less than one amp in communication systems, electronic navigation equipment and electronic circuits.
5. Pigtails less than seven inches (178 mm) used as wiring on panelboards."
3- Pigtails on nav lights are likely using the
gray area exception #4 above but the ABYC does not publish a max ampacity rating for 20AWG wire. The maximum allowable ampacity (max fuse/breaker size) for 18AWG under ABYC E-11 is 20A on 105C rated wire. Most non ABYC charts, for max ampacity, put 105C 20AWG at 11A to 13A. So again, the 5A breaker is still adequately protecting the 20AWG wire..
4- If it makes you feel better simply install a 14 GA in-line water-tight ATO/ATC fuse holder and 1A fuse on the back of the breakers load terminal. Just be aware that in-line AGC (glass fuse) fuse holders are one of the most problematic and most unreliable electrical components used on boats so try avoid them when ever you can..