Without knowing the tractor or what has been done to it over the years the symptoms you described sound like a failed ballast resistor.
The following applies to an engine with a 12 volt system which will usually have a ballast resistor installed before the coil.
There is a bypass circuit which will apply full battery voltage to the coil during cranking to make up for the voltage drop caused by the starter motor.
When the ignition switch is not in the cranking position power is fed through the ballast resistor to the coil to extend the life of your ignition components.
If it is running as long as you are holding it in the crank position it would indicate the bypass circuit is working properly.
The fact that it runs with a power wire direct to the coil also indicates there is no power being supplied to the coil from the ballast resistor.
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