In AT power supplies, there is mains power (120/240v depending on your country) traveling through the switch. That's why the wires to that switch are so thick, and is why the spade connectors usually have a plastic shroud over them.

If there's a ground wire, connect it. If you don't, and something goes wrong in the switch, it has the potential of making the entire case live, and will not be a pleasant experience.

Yeah you just discovered the hard way how AT power supplies work for turning on and off (just like me).

Now, you know what to do to avoid these mistakes which could end up terribly for you. Isulate the cables properly and add ground if possible.

This is common if the ground wire is not connected or you use a non-grounded plug. In that case, the shock doesn't come from the live wire, but from a voltage gap between the case and ground that slowly builds up during operation. If the switch would be bad and the case was connected to live, you have a serious problem with the electric wiring in your house, because there should be a ground fault interrupter that cuts voltage before you can touch it.

yes, there are live wires on an AT power switch, those insulating covers are there for a reason 😉

but this is the most important takeaway:

derSammler wrote on 2020-02-03, 17:29:

This is common if the ground wire is not connected or you use a non-grounded plug. In that case, the shock doesn't come from the live wire, but from a voltage gap between the case and ground that slowly builds up during operation. If the switch would be bad and the case was connected to live, you have a serious problem with the electric wiring in your house, because there should be a ground fault interrupter that cuts voltage before you can touch it.

unfortunately there are a lot of countries where they are not mandatory, I think in the US it is only common to have the plugs themselves protected in the bathroom for example and not for the whole house from what I heard?

Our plugs are grounded (US here), so I don't think it would be our wiring. (Had some issues in the past while I was living in China with ungrounded plugs.)

I've worked and build dozens of machines here over the years using the same outlets/surge protector, but this is the first time I've ever gotten electrically shocked , so I'm quite surprised. Granted... vast majority of those were of the ATX type though.

I'd been running with a Baby AT Athena power supply for the last couple weeks, on and off in the same position without any issues.

I'm leaning then in the direction it was the dropped plastic shielding that probably was the cause.

Anything else I might check in the case or how the power supply is hooked up?

a surge protector is not a safety device for you! it simply protects your device from receiving voltage spikes that might cause damage to the device.

if the live wire doesn't touch the case and trips the breaker (if the case is properly grounded) and you touch the live wire on the switch somehow you will get shocked if there is no ground fault protection.

be careful with that and watch out for proper insulation.
also I would suggest mounting the switch in the case so you don't have to hold it while using it, often there is a ground cable coming with the switch wires to mount close to the power switch.
and in either case it also doesn't hurt to check if you have proper grounding.

there is little chance to get shocked from an ATX power supply because there are no live wires coming out.

disclaimer: I'm no electrician so I take no responsibility for any advice :p

If the rubber/plastic insulation covers aren't staying put, pull them off and add some heat shrink over those spade connectors. Bring it right up to the end, but don't cover the end so you can still install them on the switch. 😀

The second issue is, even without the ground wire on the switch cable bundle, your PSU should be connected to the case, and should be grounded, ergo grounding your case. Simple test: Unplug the PSU from mains and use a multimeter in continuity mode. Make sure it beeps when the probes are shorted to each other, then put one probe on the PSU's outer casing, and the other on the middle lug of the IEC power input socket. It should beep. Then, test between that ground lug and your PC's case. It should still beep.

If you get continuity, then your case is grounded to your PSU, which is grounded to your wall outlet, which should be grounded to earth. That means all the parasitic charge that builds up (particularly from snubbing capacitors and transient suppression stuff) should be shunted to ground, and it won't give you that uncomfortable tingle. If not, something is very wrong and needs to be addressed.