Also, I assume that your '87 Catalina has a Universal M25 engine. If so, that 220A fuse on both battery circuits, is WAY too big.
Figure the highest load that you expect to see on the house bank (every light, fan and appliance turned on - say ~50A), and double it. That should be the size of your primary fuse on the house bank.
I have the same engine (different boat, and no inverter) and frequently start my engine on a 90A MRBF. I have a 135A MRBF on the starting circuit, but forget to put the switch in the correct position
. I have yet to blow the fuse on either circuit.
Any bank that has the ability to start the motor should be fuse protected sized to do this without blowing the fuse under any type of starting circumstances. Under normal starts a 90A fuse could work on a M-25, but if you get into a situation where she starts hard you'll very likely blow the fuse.
These engine draw anywhere from 195A to 330A, short duration in-rush, when starting depending upon temp and battery voltage but this is a short duration and well within the trip time delay curve of the fuse..
You've probably been lucky and the reason is the trip time delay.. MRBF's, ANL and Class T fuses have long trip delays.
For protecting a battery cable, what the battery bank fuse is intended for, you size the fuse to the wires max ampacity or less, if you can get away with it. As large as the wires ampacity will take is what you generally want if you will be starting an engine on the circuit.
Into a dead short, which is what you're protecting against, the fuse will blow quickly. There is really no such thing as a fuse to big when engine starting is in play unless it exceeds the wires ampacity rating. So long as the fuse does not exceed the wires ampacity rating bigger is usually better for cranking and ensures the motor will always start and not risk tripping the fuse. These fuses are for catastrophic shorts not to protect the engine starter or anything else just to protect the battery cables so by definition they can't be "too big" unless they can cause the wire to catch fire by exceeding the ampacity rating.
The ABYC makes an exception for "starting" circuits but it is still a very good idea to fuse starting circuits when you can.
Below are the ampacity tables sorted by wire jacket temp for inside and outside engine compartments. These are non-bundled wires. Most battery cable should be at least 90C but preferably 105C. The ABYC allows for going to 150% of this ampacity table safely when sizing for OCP...
What he can't do, and has drawn, is to protect #2 wire with a 300A fuse. The alternator originates inside the engine space and as such with 105C wire has a max ampacity of 178A. At 150% of the Table IV rating he is at 267A so he has still over sized the fuse for the #2 wire. The alt should ideally have it's own fuse or he could drop the bank fuse down to 250A if the inverter will allow for it and he'll be within the 150% rule. I generally prefer not to exceed 100% but sometimes you just have to if you want OCP...
He also does not need a fuse at the alt end of the wire. Alts are self limiting and can't exceed the ampacity of the wire if the wire is sized correctly for the output. The source the needs protection is the battery end of the wiring..