Moped Army

a lot of lights are grounded through the mounting bolts, i imagine thats the case.

also your rectifier is bad.
You can test it with a voltmeter or any electrical connectivity tester. It should conduct in one direction and NOT in the other. If it has low or no resistance in either direction it's bad.
it's a halfwave rectifier so you can replace it with a simple radioshack diode, any diode 50V or higher should work as long as you point it in the right direction.

Half wave rectification (using a single diode) converts AC from the flywheel to DC for lights etc. It's based on a pi relationship so without it the voltage will be pi times higher (6 * 3.14) which is about 18 - so that would explain why you're seeing the high voltages and burning bulbs.