This is the weird bit where signing in with your GitHub account (or Google account, or some others) has a dual purpose: it can be used as a SSO/identity provider, and it can also be used to grant third-party sites access to your GitHub (or whatever) account.
You just really need to be vigilant[0], unfortunately. Personally I don't use "Sign in with X" ever[1], for two reasons: I don't want to accidentally grant too much access (as happened here), and I don't want my account on third-party sites being tied to my account on the identity provider (both for reasons of privacy, and because I don't want to be stuck in a situation where I lose access to the third-party site due to an issue with the identity provider). So when I see a site that doesn't allow me to create my own account with them, I move on.
If you do decide to use "Sign in with X", then you need to carefully read what permissions to your account the third-party site is requesting, and opt out of those you don't want to give. And if you can't opt out, you need to live with not having an account on the third-party site.
It is super messed up that GitHub has suspended your account for this; it makes no sense whatsoever. This will be a third reason to add to my list of reasons why I don't use "Sign in with X" anywhere.
[0] Which is not a general solution! Any fix for a problem that involves "everyone who uses this needs to pay better attention" is doomed to fail, since many people don't -- and won't -- pay attention, and even people who usually do pay attention can make mistakes.
[1] There are a few exceptions to this, unfortunately. It's incredibly annoying that crates.io only allows GitHub login, but it's something I can't realistically do without.
You just really need to be vigilant[0], unfortunately. Personally I don't use "Sign in with X" ever[1], for two reasons: I don't want to accidentally grant too much access (as happened here), and I don't want my account on third-party sites being tied to my account on the identity provider (both for reasons of privacy, and because I don't want to be stuck in a situation where I lose access to the third-party site due to an issue with the identity provider). So when I see a site that doesn't allow me to create my own account with them, I move on.
If you do decide to use "Sign in with X", then you need to carefully read what permissions to your account the third-party site is requesting, and opt out of those you don't want to give. And if you can't opt out, you need to live with not having an account on the third-party site.
It is super messed up that GitHub has suspended your account for this; it makes no sense whatsoever. This will be a third reason to add to my list of reasons why I don't use "Sign in with X" anywhere.
[0] Which is not a general solution! Any fix for a problem that involves "everyone who uses this needs to pay better attention" is doomed to fail, since many people don't -- and won't -- pay attention, and even people who usually do pay attention can make mistakes.
[1] There are a few exceptions to this, unfortunately. It's incredibly annoying that crates.io only allows GitHub login, but it's something I can't realistically do without.