Ray, The diagram says "oil pressure switch", although from a third party manual that covers the engine ranges from 16,000 to 2,000cc. One wire. I bought a new switch and put a multimeter on. There is continuity from switch terminal to switch body.
So from what you say, if the circuit is open, like disconnecting an in-line switch, the light should go out. It never. Good point about the PTFE tape.