>I demonstrate to my students that this is most definitely not the case. I do it by climbing to a safe height, then switching off the fuel on one engine. Depending on the aircraft (and I mean the exact airframe, not just the type, because they are all slightly different) I can usually demonstrate that the MP has not changed, the RPM has not changed and the oil pressure has not changed. Over time, the temperatures will start to decrease - although if there was a fire that probably wouldn't be true either. Perhaps you should try this some time (but not in something with a turbocharger, unless you want a big bill)?
The only way of identifying a failed engine in a light twin is dead leg, dead engine.<
So what will your fuel flow be telling you?
Pace