One caveat: the rear view mirror is optional safety equipment as opposed to the side mirrors as not all cars can take advantage of a rear view mirror or have limited rear view mirror functionality (e.g. vans, trucks with trailers, etc.), and traditional mirror alignment is based on the idea that you don't have a rear view mirror and need to use them to see what's directly behind you.
This doesn't mean we shouldn't take advantage of such technology when it's available (when I drive a car with good visibility in the rear view mirror I align my mirrors like the infographic shows, pointing out so I can use them to see to the sides of the car beyond my vision rather than the space behind it or along the side of the car), only that there are plenty of circumstances when this kind of mirror alignment is not possible.
You can get wide-angle mirrors to stick on your side mirrors in those cases. I was looking into buying those when I discovered the wide-angle technique, which I tried instead.
Now I also adjust my mirrors this way: tilt your head left until it almost touches the window and point the left side mirror straight back from that perspective so you can just see the side of your car. When you bring your head back up to normal, you can see your former "blind spot", and can still see straight back in that mirror by tilting your head left. Tilt your head right by the same amount to adjust your right mirror the same way.
You should be able to see a car passing you in the lane to your left (or right) in your rear-view mirror, side mirror, and then side window (in your peripheral vision, while your head is still pointed forwards), without ever losing sight of it.
I have heard that some driving schools teach it that way now. Mine didn't.
Another caveat: this setup is probably not optimal for backing out in reverse. Straight back and a bit downwards seems better. Even better is a reverse camera, which you can often install after-market if you don't already have one.
You can get wide-angle mirrors to stick on your side mirrors in those cases. I was looking into buying those when I discovered the wide-angle technique, which I tried instead.
I adjust my mirrors they way you do (so they show the "blind spot"), but I also have the stick on mirrors which make the view even better. They're also helpful if the back of my car is full and I need to use the side-mirrors-pointing-backwards method.
I'm completely baffled by the fact that wide-angle mirrors aren't standard features since the stick-on versions cost $2 and I suspect mass-manufactured, it wouldn't be particularly expensive to add a non-stick-on version at production time.
Front pillar blind spots can be a really big deal:
https://www.youtube.com/watch?v=SYeeTvitvFU&feature=youtu.be&t=55
Not once in my life have I gone to drive someone's car and not seen incorrect mirror setup. Infographic here.
With correct adjustment, as cars leave your rear view mirror they enter your side view, and as they exit your side view they enter your peripheral vision. You still need to move your head to check for motorcycles and for maintaining situational awareness, but properly adjusted mirrors drastically reduces being surprised.