Tbg raises one of the hobby's all-but-innumerable controversies. He is on his 47th system, according to his system page, so clearly he is entitled to his opinion. There are others whose mileage varies; see posts in the archives here by Sean and Lak, among others.
My own experience is that there is no downside whatsoever to running a costly digital source from an isolation transformer of adequate size and quality, and none either to running a cheaper one from a small, cheap iso tranny. Note the word cheap. What is especially appealing about this tweak is its excellent (IMVHO) return on investment.
The power conditioning controversy has extreme positions and moderate ones, like all controversies. The extremist on the positive side uses active devices, sometimes mass-market ones with MOV surge protection, on all his gear, even power amplifiers. The purist finds no conditioner of any real help, especially not on power amplifiers where it tends to limit current supply. The isolation transformer, used on a DAC, falls pretty close to the purist position.