I've heard about never using a ball on a receiver to pull with and what can happen, but never an actual detailed incident.
Really sad.
Glad I personally do not ever do that. In fact, I keep a D ring in my receiver all the time, just in case.
You should keep your bow shackles (d-rings) in your truck. No sense in beating them up over a rock, or getting them stolen. Those hitch receiver setups are only good on a straight line pull also. The receive itself is not rated for being side-loaded.
Regarding failures, the same thing can happen with cheap recovery gear from China, quality gear that is under-rated, or misused gear of any kind.
There is so much to know to recovery safely in all situations. But a few things people seem to mess up often;
A winch should be the weakest link, always. The force of the pull is also the force applied to the object you send flying when it breaks. Sending a bow shackle with 10k lbs of force through the air is not a good idea. This is probably as fast as a bullet from a 300 win mag.
This means if you have a 10k lb winch, everything else should in your kit should be rated at more than 10k lbs, otherwise you are playing with a ticking time bomb.
Not every pull on a 10k winch is actually 10k lbs, depends on the recovery, but a 5000lb truck that's buried to the axles in the mud, could easily take 10k+ lbs of force to get out, depending on the recovery angle even more. Start with a shovel in this case.
For snatch blocks, you need at least DOUBLE the rating of your winch, because physics.
Plan to spend as much, or more on recovery gear as you did your winch. Get a good bag for it. Keep it clean. Still cheaper than an off road tow truck.
Ratings are a small piece of the puzzle, knnowing how to use everything is very important too;
The best investment is paying for a weekend recovery course, and refreshing it every couple years.