The cut off wire could be a sign of a dickie headlight switch...???
It may have a short in it.
The white wire does go to ground/earth
In the connector in the drivers kick panel is an orange wire which supplies +12v to the globe
then from the globe is the white wire which then goes to the door switch ..
Any extra globes like foot well lights are put in parallel from there ..
The headlight switch white wire which you have pictured goes to the door switch and is grounded when turning the knob
bringing on the interior light/s with the door shut.