(This is a really old topic but I wanted to capture it somewhere).
I have a Japanese reissue Fender Mustang which I love dearly, but I wanted to get a bit more tonal variation (and I was also getting a bit cheesed off with having the sound cut off if I nudged the pickup-selector switches whilst playing). Here’s a short description of the modifications I made to improve things.
Item 1: change the bridge pickup (to a Seymour Duncan Lil’ 59 small humbucker). I figured that with the humbucker in place I’d be able to get a few more tones, especially if I added a coil shunt to get single-coil tones too.
Item 2: rewire the switches. Now this one was a little more tricky. The stock guitar has two 3-position switches wired such that each pickup can be in-phase/off/out-of-phase. This actually only gives 4 different pickup combinations (not counting ‘off’) which is not a great number! And there’s that annoying quirk that it’s very easy to nudge the switches to completely kill the sound…
I wired the switch next to the bridge pickup like this, where R, W, G and B stand for the Red, White, Green and Black wires from the pickup. The three positions of the slide switch now give three combinations of the coils (parallel, series, and single coil).
The neck-switch is wired as a simple pickup selector (neck, neck+bridge, bridge), feeding into the regular tone and volume controls. This gives a much wider range of pickup configurations (7 if I can count correctly), and I’m pretty pleased with how it’s come out.