If you pass PWM over transformer, note that you probably won't get low frequency (signal) content, and certainly won't get DC. What you need is a coupling capacitor on one side, and a DC restorer on the other. This references the signal to its peak value, rather than its mean. Follow it up with a Schmitt trigger and you have clean digital PWM back (which can be sent to a 1-bit DAC and filtered to recover the original signal).
Sigma-delta is better than PWM in most cases, and reduces to PWM in the extreme cases; AFAIK there are ready-made isolators available, based on this approach.
Can also do push-pull on both sides of a transformer, so that the DC voltage at the center-tap is equal -- a DC transformer. Feed a biased signal into the center tap, and there you go (or, if you're using analog switches rather than unidirectional transistors, the signal can be bipolar, no DC offset required). This has a few downsides largely due to transformer non-idealities.
Tim