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It will all be a replaced with a tiny component on a PCB now on a modern bike !

It crossed my mind many times, basically daydreaming, about modernizing an old bike like KZ1300 (because I got to feel special about them). It would be a great project. But then, I find bringing the old technology back to life more fulfilling. Lots of it worked quite well in the old days, and it makes me happy to see that old part 'alive' again while I can still see the picture of it, in my mind, when it was marked as junk. I feel sorry for these bikes seeing them in such bad shape after years of abandonment, and it gives me great pleasure to see them shiny and ride again. But if I had a few of these bikes, I'd definitely make one all about upgrades.

I did solder all the wires back on to the switch successfully. But, the switch is crap. Real hard to move, so no way the electromagnetic cancelling will ever work. Almost impossible to turn them off (takes to much force to stop it in the middle).

I think I am going to retrofit some universal controls....

I had a similar issue when trying to figure out why my self-cancel wouldn't work. Had the switch apart, re-soldered one wire that had come off the terminal and cleaned everything with an aerosol electronics cleaner. I then found that the signal selection switch was as you described:
Almost impossible to turn them off (takes to much force to stop it in the middle).
After cleaning the contacts with some metal polish and spraying some cleaner again to remove any residual polish, I used a Q-tip to apply a film of di-electric silicone grease to those four contacts. After several cycles back and forth the left/right/off selection improved to where it should be - very easy to select L & R and particularly back to the off position. The solenoid bore and plunger need to be squeaky clean. NO lube ! Also discovered: the small brass rod/guide that the selection switch runs on needs to be really clean as does the hole in the switch part that slides on this rod/guide.
It's worth the effort, now that you've been successful with your soldering repair.
It'll be easier to revisit your switch and give this a try then it will be to rewire an aftermarket switch....... and from what I can see, on the net, a lot cheaper.