Yes thats the original condition of the wire and insulation just as I found it... This one is actually one of the more damaged ones I have found, usually the conductors just have some charring around the push-in terminals..
There are hundreds of these buggers around the city in the complexes we maintain.. All el-cheapo smith and stone devices, with aluminum backstabbed in...

I did have one only once that was as bad as ShockMe77 described... Vintage 70's leviton receptacle ( the ones the plugs fell out of all the time or were really loose even when they were new) with the aluminum actually under the terminal screws. I took the darkened cover plate off but the rest crumbled, I mean it had already turned to basically ashes anyway. The frightening thing was the receptacle had a bed cranked right up against it and there was a 1500W space heater of all things plugged in!!

A.D