The purple/white wire is actually the wire for a knock sensor. If your engine doesn't have a knock sensor, it's only connected to the ignition module.
A knock sensor is (usually) a piece of crystal cut to a specific frequency (the frequency produced by your engine during a knock event, detonation). The crystal is a piezoelectric, and produces a voltage when it's hit with that frequency. Much like the transducer of your echo sounder.
When the module sees a voltage on that wire it knows a knock event was detected and will adjust the timing according to it's programming and the engine revs. However, when there's no knock sensor, the voltage on that wire just floats, there's nothing valid in knowing the voltage on it.
When the module sees the purple/white at ground, its programming tells it to drop all the 'features' of the TB-V, and just be a dumb brick. That's when you set the base timing. The features that are disabled include an idle speed control. If the idle speed drops below (I think) 500RPM, the module will advance the timing in an attempt to bring the revs back up. That's the last thing you need when trying to set timing, the module messing the timing around, I think you'd agree.
The TB-V module has lots of cool tricks that make it a really great unit, and rather than try to detail them all here, I've attached a page I extracted out of one of the manuals that explain them all.
Chris....
