What I am finding out is that there are two common practices, from different classes and perhaps from different countries. That was the source of my confusion and uncertainty.
1. Signal Right = Pass me on the Right. As
@05XR8 pointed out on the link, it is one practice followed in some Driving Schools. Back in the 70's when I was racing Rallies, this was our practice, signal the side you want to be passed on.
2. Signal Right = I am staying Right, pass me on the Left. This is what the AI seems to do in GTS, as
@Whitetail pointed out. This practice is new to me, but when I do custom races, I do notice that by following this practice, the AI drivers yield easily, and clean races (and their bonus) are easy to achieve.
Personally, as a driver, I always signal. As a sports driver, I ALWAYS signal; it is not just a matter of courtesy, it is also a matter of maintaining the flow and the safety of the race. I do not care for winning races by blocking the competition; I do care about my car, my fellow drivers' cars, the track and the safety of the marshals and other people near the track.
Thanks for all of the input.