Even something as simple as a zener clamp with a polyfuse to make a dead-simple crowbar circuit will save a device and won't contribute a whole lot to BOM cost.
But USB-C isn't limited to 5V, power delivery is at 20V. That might explain what's going on here (since the user reports 20V on the output) - it thinks that the peripheral is a power hungry device and it's trying to charge it. That's a problem, but it could be that the peripheral is poorly designed and is mistakenly asking for power that it can't actually handle.
Edit: in this case the peripheral seems to be the Macbook charger... and plugging it in causes 20V on all the other outputs with only a dongle plugged in. Oops. Yeah not good.
I wonder what happens if you actually load the port? Perhaps it'll drop down to 5V? Or maybe it'll fry things.
That said, my comment above still applies: USB-C relies on both devices to be compliant with the spec. Otherwise you can get into situations where one device fries the other, or tries to charge things it shouldn't, etc.
And thank goodness for this, early in engineering school I was doing a project on an arduino and because I was young and stupid I kept accidentally shorting power to ground. Killed at least 5 or 6 ATMega328's but the MacBook just helpfully chirped that I was drawing too much power and it was shutting off the port. Saved my ass at least a dozen times over.
The reality was that the modem was drawing too much power and the motherboard just disabled every port on the bus.
This was my interpretation, the host sets the output voltage to 20V incorrectly (due to a software bug or a hardware failure). Putting a crowbar circuit defensively on the peripheral side would save the peripheral.
Last week I blew up a $100 CO2 sensor because I wired it in backwards. Entirely my fault for not checking the pinout, but a 10 cent diode or a fuse would have saved me.
This is the same issue with telescope controllers. Plenty are rated for 6V absolute maximum, whereas typical power supplies in astro, e.g. the power tanks, or LiPos are 9V or 12V. Boom. Another $100 when a zener would have saved the day.
It would be 49$.
That isn't going to fly for product companies in general. The issue? Cost, as usual.
Adding 5 cents of cost to a $15 USD (retail price) mouse is a non-starter, because the actual production cost is closer to $3. So even 5 cents is a lot.
https://www.nintendo.co.uk/Nintendo-Switch/Specifications/Sp...
Agreed, though for some peripherals effective overvoltage protection that goes up to the maximum port output could cost more than the device itself. I would rather get the chance and redesign the connector so that there won't be any risks of exposing old devices to higher voltages, then introduce it slowly to new laptops (say one port this year, two the next two years, etc) and possibly provide small external adapters that fit on the new connector on one side and export the old one (maybe more if working as hubs) with adapted voltages for both signals and supply lines. To me having multiple voltages driven by software on the same connector where one could insert devices that can't protect themselves in case of failure is asking for troubles. One day someone will connect a cheap LiPo charger to one of these ports and if the port firmware flips nasty things can happen.
See this comparison teardown between a genuine Apple magsafe charger and a counterfeit, especially the "What's wrong with this charger" section: http://www.righto.com/2016/03/counterfeit-macbook-charger-te...
Related, Apple ran a discounted trade-in program where people could swap potentially dangerous phone chargers for safe ones after a counterfeit charger killed somebody: http://www.cbc.ca/news/technology/apple-replacing-fake-iphon...