I've seen the same deal on many makes and models having the sender rheostat inside the tank in the fumes & sometimes covered in fuel. Never seen an older vehicle with an enclosed unit, pretty much all open framed like what you have there.
I've also pulled them out & seen missing windings, burnt surfaces, even pulled one out where the wire was melted away.
One would think that would cause ignition, but have yet to see a fire started due to it. More often see cars burn to the ground because of poor fuel line connections or old rotting fuel lines leaking into the engine bay.


1956 GMC 370 dump " 'Tater "
1970 VW Volksrod "the Black Bomber"
2007 Chevy Avalanche
2020 Jeep Cherokee Trailhawk,
2005 Harley Davidson FLHTCUI

I dig all cars, old and new, whether they were hammered out of American iron, German steel, or Japanese tin cans. Being unable to appreciate them all is missing out on a world of great things.
But thats just MY opinion!
:P