Note that the Tape Inputs are NOT grounded when not selected. If they were grounded, that would eliminate the possibility of tape monitoring. All other inputs are grounded when not selected to reduce source to source crosstalk.
Since the Tape Outputs are always connected to the output of the selector switch, ahead of the active line circuits, what Wayne is doing is essentially using the first preamp as an extension to the selector switch providing more sources and allowing one phono circuit to serve two preamps.
Simple, yes?
Frank
This idea, by the way, allows you to use an old stereo receiver as just an AM FM tuner by coming out its tape output, switching its selector to tuner, not even bothering to connect any speakers, just an interconnect set to a spare input on your main system preamp. Since the tape out is ahead of the tone controls and active circuits and volume control, you are using the receiver just as a tuner.