In NZ, the candidate certainly is the PIC.
Most examiners in this part of the world, like any other, would not deliberately set up a fail. However, it would be fair game to say something like "when you're ready, climb to 2500' and show me a steep turn." If the candidate doesn't check for airspace first, sorry. The NZ flight testing system is similar in this respect to the FAA system.
I'm sure most of us have encountered similar scenarios in the course of everyday flying.
What a bizarre idea!
Travel broadens the mind. I recommend it.
O8