Hi
the connection diagram color code is only a guide.The gray wire is an earth lead and gets soldered onto the pots metal caps,then runs to the metal surround part of the plug (not to any of the pins) It will then earth when connected to the game port
MaV

Hi
On some gameport cables there is an uninsulated wire this is NORMALY shilding wire which surrounds all the smaller cables to stop RF/Electrical interferance.Its a good idea not to connect this to anything because if one of the internal wires becomes frayed or broken it can cause a short.The best thing to do is cut it back as far as posible and cover with tape or shrinky tube  at both ends.You could use it as the earth (gray wire in the diag)but then you risk a possible short as explaned above
MaV