The red wire from the rectifier is power out of the rec to charge the battery. The only time power flows through that wire is when the bike is running, it don't need a switch.
Do you know what a diode is? If not, it is a one way valve for electricity. The rectifier is three pairs of diodes that are linked together to convert AC voltage to DC voltage. They are set up so power only flows from the rectifier to the battery.
The only way for power to flow from the battery to the rec on the red wire is if at least one of the six diodes are bad. Seldom happens.
On the 20 amp fuseyou want this between the battery and the rest of the electrics. This will protect, in case of a short in the wires from the fuse, through the main switch to your fuse box. You could run without but carry a fire extinguisher, it may come in handy to put oiut the fire.
An inline fuse holder works well. I like to wire the rectifier red wire right to battery positive. I then hook the fuse to battery positive. You can hook the rec red wire after the fuse, either way is fine.
On the 20 amp fuse holder I hook one lead right to the battery. Then run wire from the other lead to the key switch. You want the main fuse as close to the battery positive as you can. That way it can protect as much of the harness as possible.