I'm pleased to announce that the kitty is purring nicely again thanks to a new pickup coil. I've driven it about 60 trouble free miles with no cut out so far. Here's a few pointers I'd like to pass along on the chance someone needs to trace my steps when their series 3 xj6 unexpectedly cuts out.

1) you can buy a new pickup coil from terry's jag parts in kalamazoo michigan for about $165

2) if you are going to remove the 6 toothed reluctor like i did, i had a good result by using 2 paint can openers (the hooked part) to grab the underside of the reluctor and gently twist and lift otherwise it can be hard to grab
3) be aware that not only is there a pinch bolt that has to be loosened but there is also another securing bolt between the side of the distrubutor cap closest to the engine and the engine itself. reach around with your left hand and you will find it. a 7/16th wrench will loosen it for you
4) once you get both bolts loosened and you are having difficulty rotating the distributor, i found success using this tool:



i got it at napa to remove oil filters. it grabbed onto the outer edge of the distributor body (without the cap) and gave me the purchase needed to ease the assembly in both directions aided by a liberal amount of pb blaster. i was soon able to easily rotate it with my hand.

the next photo is what some jacka.. decided was a good solution for repairing a pickup coil with a broken wire:



the idiot must have broken the orange wire that was supposed to pass through the blue grommet so he connected it to the yellow wire via the female connctor that sat inside the distributor cap while the yellow wire was crushed between the distributor housing and cap. to make matters worse both wires plugged into the ignition module via simple female connectors leaving a big hole open to water, dirt, grime, heat etc. no wonder the inside of the ignition module needed a good cleaning.
it's amazing what people will do to save a few bucks. hope this helps someone in the future. thanks to all that helped me through this issue. ren

 

Really well done. Impressive find and fix.