[JAG]

Hi Frank - you are correct that the engines have to be running to see it power the aircraft; the Run/Standby switch provides power from the battery to the excitation of the alternator (field). This is really just for an inflight failure of the contactor.
I have never tested it beyond what you have done on the ground - turning the switch to 'standby' and verify light comes on. Getting the light indicates 24 volts downstream of the run/standby switch confirming the fuse is good.

If you wanted to verify a higher level of comfort on this, I would leave the master switch off, and hook up a multimeter to the field terminal of the front alternator Voltage Regulator. Flip the run/standby switch to standby, and you should get 24 volts at the field.

The system basically allows the alternators to keep powering the bus with the battery contactor open, but your battery will not be charging.

Hope that helps.
Jeff