The distributor body wasn’t a heat sink. What’s more likely is that when installed your power was routed through the coil, so your distributor short just created a ground for the coil circuit. When you bench tested it you likely connected the battery directly to the distributor terminal. This caused a direct short with no load to protect the circuit. Also, the fact that the points are what burnt tells me that the current was passing through terminal without shorting through the bushing. The points are supposed to ground the circuit when closed, and when they did they couldn’t handle the full current load that you applied to them. The next time you bench test a distributor put a light bulb between your power source and the connection to the distributor. This will simulate the coil being connected into the circuit. The bulb will also blink on and off as the points open and close, as a visual confirmation that all is right.