>VWProd catalogue and their ref 16 'thin wall' cable which replaced the original equipment type has a rating of 16.5A.
That's 1 sq.mm. conductor with modern 'thinwall' insulation, the conductor is 16 strands, each 0.2 mm. o.d.
1 sq.mm. conductor with the different - thicker - PVC insulation is rated for 8.75A, the conductor is 14 strands, each 0.3 mm. o.d. It's still easily-available certainly with Lucas insulation colour codes
Original Lucas 14-strand wire had the thicker PVC insulation but the strands are 32SWG = 0.274 mm. o.d.; the slightly smaller conductor cross-section reduces the rating to 7.5A
Original Lucas bullets were 3/16" o.d. Modern lookalikes are also easily-available but are internally-sized for modern metric conductors. I've never had any problems using the ones for 2 sq.mm. and larger conductors, irrespective of whether the insulation is 'thinwall' or the thicker. Otoh, several years ago, I had one widespread problem with 1 sq.mm. bullets on 16-strand 1 sq.mm. 'thinwall' that the the owner had sourced. So I've never used it again; bullets on 14-strand 1 sq.mm. never give me any problems.
>with the 17A continuous 35A Blow fuse, I'm pretty sure the cable would melt if a short circuit induced say 20-30A as the fuse wouldn't blow.
Mmmm ... there's a safety factor in wire ratings and, once the 'continuous' rating of a cheap automotive fuse is exceeded, you can't be precise about the 'blow' Amps. However, if I encountered 16.5A-rated wire with melted insulation fused by a 17.5A-continuous/35A-blow fuse that hadn't blown, I'd advise the owner against buying lotto tickets or visiting bookies.
>Would you say the only way round this is to make your own fuse board and route the cables from this for every circuit? With the correct fuse for each particular loading?
Two practical problems are: available fuse ratings don't match wire ratings, and space and locations are limited on a bike, especially our old heaps where no-one thought about multiple fuses. I don't think there's any one answer; whoever's building the loom has to be happy, with the number of extra fuses, their physical and electrical position and any additional wiring.