Hello !
The purpose of the whole system is NOT to have a permanently magnetized rotor... This way, the output of the whole alternator can be tailored to the exact need of the bike and no more (and no less if the system is fit enough). If you permanently magnetize your rotor, the battery will get charged even when full and will, thus, either evaporate it's water or bubble if it's an AGM in both case shorten it's life ... drastically...
As per the charging light, it is wired between the generator output and the battery positive. So it will go out when the battery voltage comes ABOVE the alternator voltage.
This explain why after first cranking the engine (and depleting somewhat the battery with the huge BOSCH starter) the light only goes off at a higher RPM. When the alternator begin to charge, it gives all it's got in current to feed the battery and did not raise it's voltage until the battery recovers somewhat from the cranking. Thus if you have a new big battery and and a perfectly tuned engine, the GEN light will go off at 1500 RPM even after just cranking the engine...
I'm always amazed at how people do not understand automotive electrics and try to "simplify" or "improve" a perfectly designed and efficient charging system (which only flaw is that it was designed for simple and low power electrics of the era)
P.S. : You should check that the GEN light bulb is of the correct wattage to provide the system with sufficient current to get started... Stick with the specified bulb as per BMW instruction and everything should be fine...