Does AM work with the engine shut off? If not, then adding filtering isn't going to help and something is wrong with your radio or antenna.
Hmm, either way I'd look to be sure the antenna base is electrically grounded to the car. A bad connection there can play havoc with reception. Pull the antenna plug out of the radio and look for continuity between the outer ring of the plug and the car body. The receiver should also be grounded, of course.
Alternator noise is usually more of a whine, while ignition noise is more like static. If you are hearing a whine, a filter (capacitor) at the alternator output may help. Beyond that, all I know to do is try it and see. A reasonable quality radio should already have enough power filtering, so adding a power filter (at the radio) won't help. But cheap units sometimes don't have enough.
This is also a good time to check out your spark plug wires. Take both ends loose, and use an ohmmeter or DVM to check the resistance between the terminals. They should all be fairly similar, around 5 to 10 Kohm for the standard wires. If you find one wire much higher than the others, it should be replaced. Check the coil wire too.
I don't listen to AM much, but as I recall the AM performance was acceptable with the Kenwood I had in my first Stag, without any added filters. The (apparently original) AM radio in the second Stag doesn't work at all, so no help there.