I've managed to get hold of the factory manual for the '86 TD, and the glow system looks to operate exactly the way you describe it.

Even better, I've got similar documentation for the 4JB1-T, and it appears to share the same glow controller design.

I don't anticipate too many hassles adapting the C223-T system for use with the 4JB1-T.

Just as an update, my new engine/transmission has been loaded onto a container and should arrive in the U.S. around mid-June. Once the 86 TD parts arrive (within the next week or so, I imagine) I'll start on the process of pulling the old drivetrain, converting the fuel and electrical systems, and repairing a few areas of the body. Stay tuned ...