Let's see how a transformer can mellow out a surge.
Pictures demonstrate how the primary protection system must be
inspected and how it can be compromised:
http://www.tvtower.com/fpl.html

Assume that protection at the base of a transformer has been
compromised by a stray automobile. Lightning strikes wires
highest on pole. Lightning seeks earth ground. Normally it
would conduct via that earth ground wire (in pictures). But
that earthing wire has been cut by a stray automobile. So
transient voltage increases until transformer breakdown
voltage is obtained. Now we have a plasma wire from
transformer primary to transformer secondary. Now we have a
short circuit through transformer that lightning uses to enter
a house and damage computer. Once the transformer breakdown
voltage is exceeded, then transformer primary and secondary
are shorted together. Transformer is not mellowing out the
surge because the essential earth ground was disconnected.

Lightning is not an ideal voltage source. Lightning is a
current source. Therefore voltage between transformer primary
and secondary will increase until that current flows. IOW
voltage will increase until the transformer's breakdown
voltage is exceeded. If current has no other path to earth,
then current will create a short circuit inside transformer.

Still that internal plasma wire and lightning current does
not destroy the transformer. What comes next is more
spectacular. Lightning does not have high energy. But
electricity from the utility does. Now we have a short
circuit from primary voltages (2K, 4K, or 13Kv) to secondary
voltages (120, 240). Higher energy electricity from the
utility then uses the same plasma connection to literally
connect, for a short period, the 2K or 13K voltage into your
house. Then the transformer explodes.

Transformer was exploded by energy from a higher energy
source - the utility 2K or 13K volt electricity.

Same is true of protection inside the computer. Galvanic
isolation provided by transformers inside a power supply can
provide 1000 or 2000 volt isolation. These numbers required
even by Intel specs. But once that existing protection inside
the computer is overwhelmed - once a common mode transient
exceeds the 2000 volt breakdown voltage, then internal power
supply protection has been compromised.

Yes, a transformer is effective protection when it performs
galvanic isolation - acts like a dam. However dams without
spillways (the earth ground wire) will fail catastrophically.

Internal appliance protection can be overwhelmed if the
typically destructive transient either is not earthed before
entering a building (secondary protection), or is not earthed
at the pole transformer (primary protection). Once voltage
exceeds a transformer's breakdown voltage, then that
transformer no longer mellows a surge.

Effective protection is about earthing a transient before
that transient can overwhelm protection already inside an
appliance. That means earthing so that a transient does not
build a plasma wire inside the transformer. Once a
transformer's breakdown voltage is exceeded, a transformer no
longer mellows. And so we say, protection is only as
effective as its earth ground.

"CL (dnoyeB) Gilbert" wrote:
...
Transformers have a way of mellowing out a surge. A surge typically
has to pass through a couple of transformers before it reaches a
damageable component.
...