Types in the Server Utilities example not working

Environment

• Operating System: Darwin
• Node Version: v18.18.1
• Nuxt Version: 3.7.4
• CLI Version: 3.9.0
• Nitro Version: 2.6.3
• Package Manager: pnpm@8.9.0
• Builder: -
• User Config: devtools, typescript, runtimeConfig, experimental, modules
• Runtime Modules: @nuxtjs/tailwindcss@6.8.0
• Build Modules: -

Reproduction

~/server/utils/handler.ts

import type { EventHandler, EventHandlerRequest } from 'h3';

export const defineWrappedResponseHandler = <T extends EventHandlerRequest, D>(
  handler: EventHandler<T, D>,
): EventHandler<T, D> =>
  defineEventHandler<T>(async (event) => {
    try {
      // do something before the route handler
      const response = await handler(event);
      // do something after the route handler
      return { response };
    } catch (err) {
      // Error handling
      return { err };
    }
  });

~/server/routes/api/auth/signup.post.ts

export default defineWrappedResponseHandler(async (event) => {
  return { message: 'awesome!' };
});

~/pages/index.vue

<script setup lang="ts">
const signup = async () => {
  const data = await $fetch('/api/auth/signup', { method: 'POST' }); //  type data = { message: string }
};
</script>

Describe the bug

Shouldn't the type be type data = { response: { message: string }}? or am I understanding it wrong?

Any help would be greatly appreciated!

Additional context

Not quite sure if the problem is directly related to nuxt...

Logs

No response

Start with server/utils/handler.ts and the server/routes/api/auth/signup.post.ts example, then inspect how the result is inferred in pages/index.vue. Compare the wrapper's declared EventHandler types with the observed $fetch type and determine whether the example or Nitro's typing is responsible. Done means the expected response type is established and the example or implementation is corrected accordingly.