If the ignition circuits come on (fuel pump primes etc) it would not appear to be a key-switch issue.
The likely culprits would be either
a) Clutch switch
b) Starter/Headlight Relay
c) The starter solenoid itself
Yes all that happens.
I will take a look at a,b,c
I'm not sure whether I am misinterpreting you here, but that would be normal
The little light bulb in the headlight bucket under the headlight is on all the time.
That one would be a bit bizarre - are you going by how you think the lamp looks, or the actual high beam indicator status?
Status indicator matches switch position. Low beam just seams a lot brighter then high.
That sounds like a mechanical issue with actuator part or the switch assembly - however as long as your headlights come on and the ignition circuits come on, then again, if your starter is only thing that does not really actuate, it would not appear to be a key-switch (electrical) issue.