I'm about to put head to pillow so I've not got time for any diagrams but the thing to note about the large scale modules (LM-4S-G, the older LM-3S-G) is that out of the box it does not follow the DCC wiring colours in any shape or form so forget about that DCC wiring page from NCE as it's irrelevant for the large scale modules.
You are correct in that you can pretty well use whichever output for whatever you want, and yes, typically white and yellow are the front and rear headlights. This is a carry over from DCC where the front and rear lights must be these outputs to be able to be directional, ie, change direction and the headlights change automatically and the small scale modules follow this convention, however this is not the case on the large scale modules, output 1 (white) being orange and output 2 (yellow) being blue. Not having any large scale modules myself I don't know if they even have the automatically directional headlights so it may be a moot point anyway.
From your question in your introduction thread, the blue wire does not turn on the lights. The "blue" wire (blue in the LM-4S-G diagram but could be any colour you choose) shown from the +5v is a positive common and the handheld controls the outputs (negative) via buttons you set.
- Tim
