1) He jerked his hand back from the fence, realizing his palm was scorched.
2) Painted wood scorched his palm.
So let's look at those two. As I said, I think the second one is an attempt to replicate the experience of the Point of view character from the inside, so concentrating on feeling/perception.
However, even in deep POV, you need to narrate action. The character has to do something, or he's going to seem awfully passive, just standing there with his hand being scorched. :) And the character not only intends most actions- that is, would think about doing something-- but also would notice if he did something reflexively, like jerking his scorched hand away from the heat.
Plus the mind really does automatically identify things. Most of us wouldn't look at a surround of connected wood slats pointing up in a backyard and think, "Oh. Painted wood." We'd think, "Oh. Fence." Our perceptions are very much trained into language after the age of 4 or so. So to me that "painted wood" part seems a bit precious, perhaps because it sounds like something a young child would say-- since once we're out of toddlerhood, most of us really do have immediate access to our vocabulary of objects. (Except for me. I've been known to wave a magazine around and say, "What do you call this thing again? Oh! Right! Magazine!")
(One picky note-- what sort of painted wood fence gets hot enough to scorch his hand anyway?)
But there's no doubt that deep POV depends on narrating from the inside, relating the character's unique perceptions and feelings as well as his actions.
So let's break this down. Here are the levels of POV (which don't always come into play all at once):
Action -- What he does, either deliberately or not
Perception-- What he perceives around him
Thought-- What he thinks, wonders, muses, intends
Emotion-- What he feels emotionally, and also what he won't let himself consciously feel
Now let's look at the event.
Hero puts his hand on a fence, for whatever reason. :)
Fence is very hot and scorches his hand.
He jerks his hand back.
We've got perception and action there. I think both are needed. If we just put:
He put his hand on the fence and jerked it back.
... the reader won't know why.
If we just have perception:
The fence scorched his hand.
...the reader will wonder how his hand got on the fence, and what idiot would just stand there and not jerk his hand back.
So how can we narrate this?
Tom (I need a name :)
Tom grabbed the fencepost, which was hot and scorched his hand. He jerked back and looked down at the blisters rapidly forming on his palm.
Okay, inelegant in the extreme. Also I added a second perception-- he looks down at the blisters.
Now let's consider adding thought. This is not a mere lower-level animal who merely perceives and acts. He also thinks. So what is he thinking? I doubt he thinks, "This is hot! Take my hand away!" because his action really is going to be reflexive, bypassing thought. But before and after that perception/action pair, there is going to be some thought.
Musing about the nature of physical reality, Tom grabbed the fencepost, which was hot and scorched his hand. He jerked back and looked down at the blisters rapidly forming on his palm. He decided he should pay more attention to the actual physical reality around him when he mused.
Okay, now he's thinking!
How about emotion? Can we add that?
Musing about the nature of physical reality, Tom grabbed the fencepost, which was hot and scorched his hand. He jerked back and looked down at the blisters rapidly forming on his palm. He decided he should pay more attention to the actual physical reality around him when he mused. How could he have been so stupid? He hated himself. He wished he could die and be reincarnated as a garden slug.
There's some emotion. :)
The problem with stream-of-consciousness is, done badly, it reduces human beings into mere nerve endings-- able to perceive but not act, think, or emote, not to mention decide, intend, love, hate, all that good stuff.
So it's useful to be reminded to narrate from the inside out -- what does this character see, feel, hear? But that "scaffolding" of narrative is a conventional way, I think, to convey what ELSE is going on, both inside the character and outside, as the character experiences and not just perceives it. Experience includes thought, emotion, and action too!