Why do we ground our power?
I know this sounds basic, but hang with me here. All I can find in the outerwebs are variations of "it's for safety reason" and "think of the children", no actual explanation. And the videos that are trying to explain it just stick to code. But to me it just seems like we're inviting extra issues to combat the rare static-like discharge. I am starting from the point of an isolation transformer. Unless you complete a circuit to the other lead, you will not get zapped (we're talking 120V at 60 Hz). Now with a grounded transformer situation, suddenly the floor is lava - everything and anything is a path back to the transformer. How is this better? Is it for the sole purpose of GFCI outlets/breakers working?
SOLUTION: So, basically, yet again I've reaffirmed my belief not to trust the average individual. Though, thank you Hillman314 for sharing what you know, that wasn't just regurgitating code at me, you helped.
My issue that I was trying to work through in this topic was such - if we use an isolation transformer (that let's the ground lead through in parallel without bonding to the secondary) then we are pretty safe to troubleshoot our electronics while they are plugged in and live. Moreover, "the first ground fault is free", meaning, that if there is a fault where one of the hots comes in contact with the ground, that does not necessarily mean explosions. It just means that now our device has a neutral bonded to ground and is just as unsafe to tinker with as it would be plugged in without an isolation transformer. This first free ground fault could be done by the tinkerer accidentally by brushing against something you shouldn't or probes slipping or whatever.
How unsafe is tinkering with with a device without an isolation transformer? Well, your first warning is possibly death. No freebies. Oh, but that's common knowledge, any bumpkin will tell you not to go out of your comfort zone and leave such things to the professionals. God forbid people had hobbies in a time when wages are low and professionals cost a year of savings for any minor issue. Well, if isolation is the thing that gives us a freebie, then why don't we all use it? Well we kind of can... and can't. The transformers that turn medium voltage power lines to our 120V socket power ARE isolation transformers by their virtue of being... transformers. That's how they work. The main issue is capacitive coupling. The medium voltage on the input is getting transformed to the low 120V (let's not get into any "well, ACKCHYUALLY, center tap split phase" member wagging shows of ego here), but there's something more happening, just by the virtue of the medium voltage running next to the low voltage, there is charge between them forming as if it was a capacitor. We can account for that with enough insulation, because it should be a constant force, but the problem are random voltage spikes caused by faults elsewhere, lightning striking something electrified somewhere... just a split second of higher voltage, but that can be enough to bust through our planned countermeasure. It will arc, but, even though it will not be a maintained arc, it will do damage to the transformer and could set things on fire at the moment of happening. Simple solution? Bond input and output to ground, that will sort out their differences. But now we're back at no freebies, because that bond just grounded our system. Well, if a separate transformer is used where the input is 120V and output is 120V, and the voltage spikes are taken care of by grounding on the previous one, then NOW we are safe, right? right....? Kinda. Next hurdle is home-made lightning. So the isolation transformer (the 120V to 120V with no bonding on the output) will give us usable 120V power and our devices connected to that will work with no issues. However, the earth beneath our feet can feel differently about our 120V. Normally, since there is no bonding to ground and no earthing, ground is not part of the circuit and should not have any flow of power to it (we're talking about touching one of the hot leads and electricity should not flow through our bodies into the floor). But usually there is a voltage to ground if measured by a multimeter. Often times as high as half of our 120V. Fortunately for us, even though the numbers can look scary, if actually given the chance to flow, the amperage is miniscule and the voltage instantly collapses to something imperceivable. This is again due to our "friend" capacitive coupling. Now, how this works, I could not find any good explanations, cause we're already in the weeds here... But, it's not dangerous, because the system is behind an isolation transformer, there is no grounding here. Yay, right? Well... how earth feels about our ungrounded power can change. And even though between our hot leads there is always just 120V, due to changes in who knows what, but think of it in terms of lightning, there is a potential difference between the sky and the ground. Well, the potential difference between our isolated system and ground can vary, and the issues arise when it stars going up. We're not talking about just 60V, we can get up to hundreds and higher. Is it dangerous? Not directly, static discharge just from rubbing our feet against the carpet is in the thousands of volts. Same here. The issue is that eventually when it goes high enough, it will create a static discharge of it's own. Our wires are rated to a certain voltage it can protect against, I believe the household wiring is rated for up to 600V. Well if our isolated system is going into a thousand volts compared to ground (hot-to-hot of the transformer is still 120V and nothing is changing there), it will "static" discharge somewhere we may not want it to. Most benign would be punching through the 600V insulation into a metal chassis in one of our devices (if the chassis is grounded, but not bonded to neutral). Now we have a hole in the insulation in that one spot which is no longer 600V rated... Tragedy? Probably not, but... sparks are never good next to flammable things. Especially when you can't control it where it happens.
Basically, the main goal of grounding on our electrical systems - to discharge this home-made-lightning so it does not do that in random locations around the house (as I understand, we're talking maybe once a day or rarer). My issue is that by bonding and grounding we are losing that "first ground fault is free". Let's say that first fault happens, we can have a monitoring systems that would tell us we do have a fault, we can fix it and get back our get-out-of-electrocution free card. Apparently the solution is called High Resistance Ground. Again, sort of... The idea of HRG is not to have short circuit currents flowing in case of a fault, but limit them to something reasonable that gets detected and power shut off. This requires different power interrupters than we have as our power breakers now. And still, we're mostly talking about protecting equipment by limiting the flow to 1-10A, still lethal to humans.
Is there a solution to all of my reading? Maybe... It would involve an isolation transformer for the whole house, a ground lead bonded to neutral via a resistor that would limit flow to milliamps and an alarm system monitoring voltage on the ground lead informing of a ground fault.