OK - but that's sort-of 'sitting on the fence' as regards the current reg's wording of what C2 and C3 mean.
One thing I think is clear - an EICR is meant to be a report of the installation at the time of the inspection - so I don't think that "what something might end up as" really comes into it. Hence, if you feel the situation is 'potentially dangerous' at the time of the inspection you should obviously give a C2, but if you don't feel that, you certainly should not give a C2, and arguably not any code at all. I personally don't think it makes sense, or is 'intended', that you should give a C3 to something because, although it does not deserve a code at the time of the inspection, it 'might end up' deserving a C2 at some point in the future!
Definitely coded. As you say, C2 ....
To attempt to clarify even further, given the regs as they are, it's the C3 that I have problems with. If one's opinion is that something presents a 'potential danger' (which I would say your illustrated cable does - a cable that is likely to be driven over, or insulted by tools, is a totally different kettle of fish from one behind a DW!), then it's a C2 - but if one's opinion is that it does not present a 'potential danger' then I don't see why one should be 'recommending improvement'.
