How is a pencil sharpener a wheel and axle for a simple machine?

Well, if you look at the simple definition of a wheel and
axle machine, namely that it must have a wheel and axle, the pencil sharpener fits
perfectly, particularly if the pencil sharpener is a non-mechanical one, just one you
have to twist.  As such, the pencil of course acts as the axle and then the sharpener
itself is the wheel as it goes around the pencil.  It gets a tad more complicated if you
are looking at the mechanical version, but likely could still be explained into the
definition if necessary.  The article referenced below has some other good examples of
simple wheel and axle machines.