The instant a transistor turns on, it applies 12V to the transformer, which appears on the secondary, which gets dumped right into a capacitor. So, the transistor is shorted into a capacitor.
If the pulse width comes up slowly, the leakage inductance of the transformer (depending on design) will reduce peak current as the capacitor charges, until once it gets up to full duty cycle, even if the load is heavy, one pair of rectifier diodes is almost always conducting and the likelihood of large peaks disappears.
At this point, the regulation is shit, but in an application where that doesn't matter, the error amp is simply shunted to deliver full duty cycle. This is typical of the DC-DC converter in almost every automotive power amplifier over 50W.
Just because they use it, doesn't mean it's any good. What it is, is cheap, and that's all they care about, not reliability, not regulation, not safety (isolation or current limiting).
Attempting to regulate output voltage with PWM will result in instability (likely necessitating a long time constant) as the duty cycle required to deliver some voltage and current will be small and dependent on the transformer's leakage. All the power that doesn't go into the output goes into avalanching the transistors, cooking them quickly. The efficiency will also be crap, even discounting the avalanche losses.
A series inductor, on the primary or secondary side, is used to soften the blow, analogous to having the transistors punching bouncy rubber springs rather than brick walls. If you put it on the primary, you need a current mode inverter and a current source supply, so better to put it on the secondary while controlling the current delivered (the PWM controller should regulate current, with voltage regulated externally as a second step).
This is what a choke input filter looks like,

but the current limit (a shunt resistor in the ground return of the transistors) is pretty shitty: it will work to protect it from overload, but it won't be particularly stable or sharp (the current output will continue to rise as voltage falls, rather than hitting a solid constant current limit). If the output winding is ground referenced, rather than stacked on top of the supply, then that can be used for current feedback, and it will yield a solid current limit.
This circuit also shows voltage mode feedback, which is bad. Current mode feedback is preferred. The TL494 contains two error amps, but since they are tied together, a two-loop solution is not possible alone, and another op-amp is required. Fortunately, this can also be a voltage reference, like a TL431, making this approach easy to apply for isolated circuits.
Tim