It may very well be connected not-per-drawing; however I would not expect this to have caused a flash-bang sort of incident. I would look closely at the relay's internal wiring. It may or may not be feasible to connect it per the drawing with this exact relay. It seems that the right-side pin on the compressor is the R terminal, and the relay coil winding goes into the socket for this pin, without any provision to connect an external wire. There may be no alternative but to connect it as you had it, with the capacitor current going through the coil. The relay has a 9 amp pickup, so it shouldn't have been activated by the small current from the relay.
It would be a good idea to test the capacitor with a meter (having capacitance test mode) as well as testing for shorts in the capacitor.
If the capacitor shorts, the effect will be the same as the start-relay staying in start mode. That would cause high current and a tripping of the overload.
The capacitor and motor winding form a resonant circuit. The voltage on the capacitor can build up to a higher voltage than the motor's supply voltage. Depending on the design of the motor and capacitor, it could have very well exceeded the voltage rating of that super-cheap plastic capacitor.
If the cap is failed now, that would be something I would look into for the next one. They sell standard voltage ranges with 250 being followed by something in the high 300 to 400V range.
All of this depends on the motor's winding design and size of the capacitor. If someone else has done this and knows, hopefully they speak up. If not then the only way to know is to test and measure.
Here is a selection of caps which could possibly suit the bill:
https://www.grainger.com/search?searchBar=true&searchQuery=run+capacitor+15uF
Regardless, after everything cools off, the circuit breaker should reset. Unless something shorted to ground, or to the motor's C terminal, the capacitor failure could not have created a direct short which could damage the Guardette. It could have only created an overload condition by the start and run windings in effect at the same time, which would cause the Guardette to trip; and then require a delay before it works again.
Don't give up!