A switch in a mains circuit should always be fitted in the live wire. If the switch were in the neutral wire instead, opening it would still leave the live wire connected to the appliance. The appliance would look switched off, but its parts would still be at 230 V. Touching one of them could be dangerous even though the switch is open. With the switch in the live wire, opening it disconnects the appliance from the 230 V supply.
The live wire is dangerous because the human body can complete a path between it and the earth. The earth is at 0 V, so a potential difference of about 230 V acts across anyone who touches a live wire. This makes a current flow through the body, which can cause a painful shock, serious injury or death.
Any connection between the live wire and the earth is dangerous. It gives the current an easy path with very little resistance, so a very large current flows. The wires can overheat and start a fire. If the case of an appliance becomes live, the earth wire gives the current a path, the large current melts the fuse in the live wire and the appliance is cut off from the supply.
Insulation protects us. Plastic around the wires and plastic cases on devices stop the user touching the live parts.
