I have a 1988 k100lt with 140k miles. Purchased from a bmw mechanic in brooklyn. Mechanically the bike is great and had never had any electrical problems to the previous owner. 

I have been riding the bike for a little over a month.  A few gremlins I've encountered :
Sometimes the cooling fan cycles on/off with the blinker. 
Sometimes when i turn the ignition and pull the brake the lights go dim on the instrument cluster and the bike will not start until ignition is switched over again. 
Taking the bike on a road trip from ny to al i noticed that sometimes a loss of power would occur around 4k rpms or 3/4 throttle. Pulling the clutch the engine would rev past 4k fine but in any gear the power was lost. Restating the bike would fix this for a couple hours. 
Made it 1000 miles to alabama. 
I was heading back to ny through Atlanta and all the sudden i noticed that the tachometer/speedometer wasnt working, and the battery light was on. I pulled the clutch to restart the bike and nothing, no dummy lights... Blinkers, horn, headlight and brakes all work. So i pushed the bike off to get it off the interstate. Pulled to the nearest gas station and as i was using my blinker to turn, trying to cancel the light, smoke came pouring out of the right hand controls and from under the gas tank. Shut it off... walked it to a stop and checked the wiring. Lots of stuff fried on the right hand control connection, all the way up to the wiring for the fuel and fan cluster. 
Cant believe it. 
Not really sure where to go from here.

I'd guess there was a short between the kill switch input and the handlebars. Don't give up just yet - complete wiring looms in good condition do come up on ebay. There's also the possibility that someone here will have one.

Might be worth checking the headlight switch on the right hand cluster if it is a model that has headlight switch as the headlights supply is not fused (believe it or not) from what I can see on the circuit diagrams while recently working on my K75.  A burned harness sounds like a fault on an un-fused circuit to me.

Cheers

A thought - post some pictures as that will give an idea as to whether it's repairable.