We have metal pipes underground for 10+years. Can't powerwall handle that? Also you probably don't need full enclosure to be metal, can be some corrosion resistant material, and only metal heatsink.
Lithium batteries do not need external oxygen to burn and toxic smoke coming up from your backyard with no way to reach the source doesn't sound like a fun proposition.
Unless you happen to have a coal seam in your yard or live on a peat bog it's overwhelmingly more likely that it'll run out of fuel before it hurts anything.
People have been digging fire pits (or building up the ground to the same effect) for millennia because it makes fires more controllable.