This kind of crap is what makes me skeptical of half-assed white papers.
Same "big brained" author earlier Microchip TB008: "As mentioned earlier, the neutral should be connected to earth ground through a fuse. This would insure protection in case of improper wiring."
edit: this already hit the fan a long time ago
https://www.electronicspoint.com/forums/threads/microchips-tb008-reprise.114717/ yet OP posted the same idiot fuse/ground placement.
edit 2: Rod with Elliot Sound already sounded the horn
https://sound-au.com/articles/power-supplies2.htm see section 7 Cheap Death ala Stan D'Souza.
"Rod,
We apprecaite your saftety concern and taking the time to contact us.
I've looked into the design quite carefully, and there is no issue with the design. The purpose is to cover the accidental case of plugging in the plug backwards (unlikely since most plugs are no polarized), and to cover the common case of a miswired outlet of a swapped hot and neutral. If these situations occurred with this design, the neutral would have power on it (due to the swap) and would be immediately grounded.
The result would be a rapidly blown fuse (the one connecting to neutral in the design) and thus provides a safety to prevent the neutral line from having hot on it. The hot line would actually then be connected to neutral, thus the design would have no power, and no return, and no hot connection in this case.
I'd agree that since it is a high voltage design, a warning would be a good idea if only from a legal perspective. However, this was not a design presented in some magazine to the public, but is an engineering document. It is assumed that engineers would be viewing it and would take normal precautions when working with AC power circuits. However, we should not make that assuption, so I will request a warning be added regarding working with AC power.
The design otherwise does not contain a flaw.
Also, if the power is connected correctly (neutral to neutral, etc), then the connection of neutral to earth should be harmless since they are supposed to be at the same potential. If they are not, it suggests a wiring fault, or other issue. I'd argue that perhaps a small resistor should be added to deal with ground being a few volts above and below neutral and not blow the fuse - this situation can happen when heavy loads are placed on the power lines, and the voltage drop it causes can cause a small difference in voltage between grounds of outlets on different circuits, or a difference in neutral and ground potentials.
If after this discussion you still feel the circuit presents a hazard, please detail how this is the case - where the current would flow, what conditions, etc. It would also be helpful to indicate where this violates code. I do believe that it is not permitted in house wiring, but there is nothing I am aware of that says it can not be done in a design. Also note the lines are not directly connected, but are fused. However, the worst case even for a non fused link, would be to trip the circuit breaker on the house, which would detect the excessive ground current (due to the live being connected to ground).
If the resolution provided does not solve your problem, you may respond back to the support team through the web interface at support.microchip.com. Telephone support is also available Monday-Thursday between the hours of 8:00am and 4:00pm MST and on Friday between 10:00am and 4:00pm."