The grille lights (inboard or outboard) are high-beam only (two prong) and as stated above come on with the floor switch after the headlight switch is pulled-out. The fender lights are both Low-beam and High-beam (three prong) so when the high-beam switch is depressed you have 4 high-beam lights on at the same time.
This and the extra tail lights had a tendency to overheat the light switch and all lights would go out (not fun at night) until the switch cooled and all would come back on - for a while.
The portion in the owners manual you highlighted is reference to the fog light that were part of the GT package on a "standard" Mustang (the smaller lights in the grille of those cars see attached image) - not a Shelby.
Also, all the head lights on the '67 Shelby are the smaller diameter, not the larger standard Mustang Lights.
Please clarify.
Its my understanding that all 4 lamp head light systems, back in 67, used low beam or high beam dedicated lamps. Relative to 67 Shelbys, the fender lamps were low beam only. The inboard or outboard grill lamps were high beam only. Thus when the high beam switch was stepped on, the inboard or outboard grill lamps (high beams) were activated/inactivated. The fender lights did not become brighter high beams. I believe that having 4 high beams would have violated DOT regulations in more than a few states.
In cars that had only 2 head lights, i.e., 67 & 68 Mustangs and 68 Shelbys, the fender lamps were combination low beam/high beam lamps. Those lamps had an additional filament that was activated/inactivated via the floor switch.
If I got this wrong, please correct me.
I hope this helps.
Steve