Whoever thought this would burn your house down didn’t read the diagram. The only wire external to the circuit is the ground.

This is 100% a safe way to wire an outlet, provided you don’t expect it to deliver power.

This picture doesn’t show how to write sticker, but now to write plug. The wire that’s labeled ground is actually attached to live connector, although I guess that doesn’t matter as live and neutral are shorted by white wire.

The wire coming into the circuit is the ground, though. Anything after that is irrelevant since the ground is the only wire present.

Plug, not outlet. It’s even labeled as such

It’s irrelevant for the diagram. The only wire in the circuit is the ground.

No, it’s not the only wire in the circuit. If that plug is plugged into an outlet, then the hot live wire is coming into the circuit at the pin labelled live, and connecting to the ground wire of the device. That ground wire is usually connected to the metal frame of an appliance. Because of the white wire connecting the live and neutral pins together, it’s going to immediately flow back to the breaker box. However, if for whatever reason the path from the ground of the device to actual ground is shorter, then the electricity will flow through the device. It is possible for a person to be in the path to ground. The way this is wired might also circumnavigate an RCD, preventing the safety switch from operating correctly.

An RCD measures the difference in current flow between the phase and neutral, so it will trip in this scenario. An alternative path to earth is precisely what they’re designed to detect.

Ah yeah, you’re right, my mistake. It’s wild to me as an Aussie that they aren’t universal in the States. Plenty of houses (or outlets?) don’t have them IIRC?

Plenty of old houses still don’t have them in Australia and NZ, but they’re required on power circuits in new builds.

As they should be, they’re an incredible technology.