The 12V always on connection should be powered from a new circuit run directly from your battery. This is the main power wire and should be size appropriate to handle the maximum input current of the supply as well as to avoid voltage drops which will lower your hard cutoff margin -- 8 to 12G is appropriate depending on the length of your runs. The IGN line can be sourced from whatever is appropriate for your setup. The supply only uses this line to for logic level switching. 18G should be fine.
* I don't anything about the wire colors you're talking about. My M1-ATX did not come with any power wires -- just 3 spade terminals.