Okay, I'm Officially Stumped.

[Bill Roosa]

Well not at all sure what is "wrong" as you did not ask a question in your first post but the diagram has the starter connected to the 3-way. the 3-way common should be the primary source of power for all boat systems and the two battery banks are wired to the 3-way terminals 1 and 2 respectively.
Ask yourself how are you going to isolate the starter battery when overnighting and you should come up with the correct wiring.
Also, the use of a 3-way as a selector for you volt meter is massive overkill. you can get a DPDT switch at Lowes to do that (with some extra dedicated low amp wiring) FWIW

 

[Red_Dog]

Well not at all sure what is "wrong" as you did not ask a question in your first post but the diagram has the starter connected to the 3-way. the 3-way common should be the primary source of power for all boat systems and the two battery banks are wired to the 3-way terminals 1 and 2 respectively.
Ask yourself how are you going to isolate the starter battery when overnighting and you should come up with the correct wiring.
Also, the use of a 3-way as a selector for you volt meter is massive overkill. you can get a DPDT switch at Lowes to do that (with some extra dedicated low amp wiring) FWIW

My question was implied: Why do I have power to the DC circuits with the battery selector switch off? Something was not right when I realized that I had power to the cabin lights, refrigerator, radio, etc. with the battery selector switch in the off position.

Jim26m, Brian D, Heritage, and Main Sail all started to point to that jumper connection as the source of my woes. Main Sail, in particular, gave me a pretty fair description of what to look for. I also suspected the issue might be the jumper from the alternator to the starter, as I mentioned in my OP. Because of their suggestions, I went back and did find the jumper. After removing the jumper, everything worked as it should. Problem solved.

Isolating the reserve/starter battery, for me, is straight forward. As that battery is bank 2, I won't turn it on unless I manage to run bank 1 (house) down to the point it is unable to start the engine. The off-1-both-2 switch becomes an on-off switch between off and bank 1.

The voltmeter 1-2-3 switch may well be overkill. It's integral to the panel. Why not use it? And, why not wire it as Blue Seas shows in their diagram?

 

[Jim26m]

I came. I saw. I problem solved.

It was the red wire on the back of the alternator. It was easier than trying to find at the back of the starter. All of five minutes to take care. Oh - that was the only wire connected to the back of the alternator.

Beer and sandwich are happily chillin' away while I do some other things.

Thank you all!

Fantastic! Glad you found it!

 

[Jim26m]

Well not at all sure what is "wrong" as you did not ask a question in your first post but the diagram has the starter connected to the 3-way. the 3-way common should be the primary source of power for all boat systems and the two battery banks are wired to the 3-way terminals 1 and 2 respectively.
Ask yourself how are you going to isolate the starter battery when overnighting and you should come up with the correct wiring.
Also, the use of a 3-way as a selector for you volt meter is massive overkill. you can get a DPDT switch at Lowes to do that (with some extra dedicated low amp wiring) FWIW

It is common to see the starter post used as a battery connection for the alternator. Fortunately, @Maine Sail had seen the jumper in the loom before and could point more directly to what we suspected. Little harder to find issues when wires are cross-connected in the loom.

The install manual for the electrical panel shows the meter hookup as @Red Dog installed it. In fact, the whole diagram looked good (which I guess is the cause for the original post). When all of the batteries are disconnected at the main selector switch and your DC devices still work; that's what I consider a problem. Per his diagram, the system should have been dead - indicating there was a connection somewhere to power that @Red Dog hadn't found. I enjoyed the hunt (although I did not take joy in your frustration RD).

Thanks for posting @Red Dog. Always glad to learn something from @Maine Sail.

 

[Red_Dog]

When first wiring the setup and got to the alternator/bank 1 connection, I knew that jumper was suppose to be there. Even after digging through the loom, I didn't make the mental connection between the red wire at the alternator and the starter. I said shrugged earlier, but it was more I didn't know where the other end was so I left it connected.

Main Sail's description made all the difference in making the solution simple.

I've learned, when Main Sail speaks; you listen. You might disagree, but you listen.

I had some very good advice from this thread. No esotarica tangents about the theories and engineering of electrical systems. I was asked questions to clarify what and how I found the problem, and then, people focusing a likely cause. I had less frustation becuse of it. Good job all!

 

[MitchM]

i'm glad i have the '12 v doctor's alternator book.' i'm glad my alternator is working.

 

[NotCook]

"This is one of those there is no right or wrong way of wiring a voltmeter. In more opinion and what you want is what important. A meter wired directly to the battery will give a true voltage at the battery. Some will want the true voltage at the panel. Both are correct."

That didn’t help much, other than to confirm that you should see voltage if the batteries on the meter as wired, and that is not the source of the power to the loads.

On the other hand, looks like Maine Sail identified the problem and solution...