A follow up on this. I decided to gouge the frame anyway as I could not find any light gauge black zip-cord locally. I also mounted the the tail light to the bracket. That required drilling out the hole on the tail light a bit.
The wire connections are finicky so if someone was wanting to use one of these for serious night cycling they may want to think about soldering the connections as somebody mentioned above.
The front light gets 18-20 VAC, and the rear 4.5VAC measured with a digital multimeter. Must be separate windings as the voltage does not change with one light not connected. The rear bulb is a 6v flashlight bulb, I guess they figure running it under voltage will make it more reliable.
A diode and 8 AA cells will most likely keep the voltage down a bit on the headlight, and keep it burning when going slow or stopped. Anytime the generator puts out more voltage than the batteries it would not draw from them, so I see no need for rechargables. That would not run the tail light, but I have a rear reflector.
These units normally go for $20-$30 + shipping, I guess they are worth that considering a hub generator would cost $100 or more. And they have a retro look that looks correct on the old 3-speed bicycle.
ADDED: The switch on the headlight is high beam when in the center position and low beam to either side. I would consider it more of a back up bulb switch, so you could get home if the main bulb died. As I said in a previous post the main bulb is a automobile type (most likely a tail light bulb) and the low beam is a flash light bulb.