[BUG] /terminal-setup operates on $XDG_CONFIG_HOME/alacritty/alacritty.toml instead of ~/alacritty.toml (if exists)

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

The /terminal-setup command ignored the alacritty configuration file at ~/.alacritty.toml, writing to a non-existent ~/.config/alacritty/alacritty.toml instead of merging the Shift+Return keyboard binding. This causes overriding of all existing settings including color schemes, fonts, window options, and custom keyboard bindings.

What Should Happen?

/terminal-setup should preserve existing configuration by reading the current alacritty config in all valid locations and merging the keyboard binding into the existing [keyboard.bindings] array

Steps to Reproduce

1. Create an alacritty config at ~/.config/alacritty/alacritty.toml with custom settings (colors, fonts, etc.)
2. Run /terminal-setup in Claude Code
3. Check the alacritty config file - all previous settings are replaced with just the keyboard binding

Claude Model

Sonnet (default)

Is this a regression?

I don't know

Last Working Version

_No response_

Claude Code Version

2.0.76

Platform

Anthropic API

Operating System

macOS

Terminal/Shell

Other

Additional Information

The command should either:

1. Parse existing TOML and merge the binding
2. Create a backup (.bak file)
3. Warn users before overwriting