TLDR: is a Neutral wire in a "live + neutral + ground" setup the load output wire or a neutral wire when doing light switches?
My house is ca. 1907 for context, and the only wires I've got are:
- Red (Live), tested with multimeter.
- Grey (Neutral..?), was connected to common terminal of old (traditional) switch
- Exposed (Ground?) Connected to terminal housing.

My new dimmer supports "with or without neutral" circuits:

but what confuses me is how the 2nd wire is a neutral line, but clearly is being used as common; should this be connected as neutral, or do I have a "no neutral" circuit setup?
I've got some old wiring from the cellar to demonstrate what I think is correct, including some ground wire taped up to connect the L+N terminals as the circuit describes:
(NB: Brown is Live, Blue is Neutral, this wire postdates the house by a LOT)
I mean it has to be the load output, how else would that work. In order to make a circuit, it needs to be live - switch - lamp - neutral. If you just had live and neutral, the circuit would be live - switch - neutral, which I guess would make a funny let's blow the fuse prank switch or something.
Yeah I didnt really think that through lmao. and to think i was considering physics at university...