1982 KZ1300 - Acts Like Direct Short When Battery Connected

Arm-chair diagnostics are difficult and speculative, at best. With this in mind I am presuming that when you say "sparks" - they're of the "fireworks" type. So, another "off the top of my head" thought: You've likely pulled the starter motor if you haven't found the problem. Check the insulators that isolates the "+" stud on the starter motor. Also check the Starter-Motor power cable and it's routing to confirm the insulation hasn't been worn through or age cracked.
The solution is probably very simple.
On these old 2 communicator starters it is not uncommon for them to hang between and short. Turn the starter by hand some then re-energize."
The word "short" can be misleading. More correctly for the way this comment was worded it should be stated as an "Open short". This would commonly refer to one or both of the brushes being worn too much to contact the commutators or being dirty and sticking in the brush holder (insufficient or no contact).

Well, a short and an open are basically opposite things, so I assume you meant the starter getting hung up between contacts would lead to an open circuit and no power to the starter. Which makes a lot more sense to me in general. If it caused a short, that would lead to a lot more disastrous results.

Well, fortunately the "dead short" turned out to be a whole lotta nuthin'. I think the fireworks were just because one of the leads to the disconnected Main Switch had gotten grounded out.

Thanks to everyone for your great suggestions!