Sorry Manny but I can't understand how that can work, as you have conected the Hot and Ground of the signal path with the LDR. So, when the LDR resistance is higher than 0 (ok, let's say 5 Ohm, making a current divider with the wire 0.5 Ohm resistance) You'll have all the signal going directly through the wire and in=out (>99%) and only when LDR is 0 you'll have some signal drain to ground. You probably have written it down wrong, as the LDR should be in series with the in and out hot tips.
Regarding the pot, thanks! You've choosen to vary the depth by changing the LED intensity with a 5k Log Pot.