Rik
Assuming your bike has an ammeter,switch the lights on with the engine stopped and note the ammeter needle position. It should be showing a discharge.Start the engine and rev it up gently,the ammeter needle should move towards a charge if the dynamo is working.Depending on how good it is may even move the needle to the charge side. My WM20 and my Matchless(same system)shows a small charge under these conditions.
The test will not tell you how efficient the dynamo is but if there is no sign of a charge it gives you a starting point. The Matchless site mentioned before is a good place to start if you need to go into more diagnostics.
Hope this helps
John
If you are not sure of the polarity of the dynamo. Take the field wire and flash it against the live terminal of the battery this will ensure the dynamo is correctly polarised. If you want to see if dynamo is producing electricity, insert wires into the terminals on dynamo join free ends together hold on the side of a 12 volt bulb and touch base onto a metal part of bike. On revving engine bulb should light. Use 12 volt bulb as dynamo can produce 20 volt if revved to high
If you are going to fit a mechanical regulator don't use an Indian one. Best thing to do is buy an electronic regulator and fit inside old one after gutting it. Can recommend Dynamo Regulators Ltd. www.dynamoregulators.com.
I can recommend Dave Lindsley. His solid state regulators are built to [modern] army spec standard. If you buy one of the cheaper far east made ones that fit inside the regulator body he says to cut away the fibre base and mount directly on the steel chassis in order to keep it cool. My cheapo Paul Goff item now has a thick ally base added with heat absorbant paint on the interface: all to help dissapate heat. I had a fibreglass battery from Paul to replace the same make that wasn't working. Although I wrapped it in rubber foam it lasted a month or so, so I went and bought a trad lead acid, which has been fine.
I've got a couple of MCR2s that have been tested and are worth setting up, but as far as I know the 2nd world war regulator was different