Smart-meter data is sensitive, and its centralization raises privacy concerns. Federated learning and privacy-preserving techniques promise to enable analytics without compromising user confidentiality. The practical viability of these methods in real-world smart-grid applications remains uncertain. A critical synthesis of their limitations, privacy assumptions, and deployment gaps is still needed. This review critically evaluates the state-of-the-art in federated and privacy-preserving learning for smart-meter analytics, grid-edge control, and DER coordination. It focuses on both methodological promise and deployment realism. A critical review of 27 peer-reviewed articles from 2017 to 2025 is conducted. The assessment focuses on technical performance, privacy guarantees, scalability, security, and deployment readiness. The review identifies key strengths in theoretical privacy and decentralized learning. It also finds substantial limitations in communication efficiency, non-IID robustness, adversarial resilience, and energy-sector-specific feasibility. Federated and privacy-preserving learning holds great promise, but critical technical and regulatory barriers must be overcome. The review provides a roadmap for future interdisciplinary research.