This design wasn't too uncommon 20 years ago, with older diodes having a completely different behaviour. Old LEDs could handle huge current spikes without a problem, and could run with extreme multiplexing as long as the average current wasn't too high. And there wasn't pesky laws about power factor correction of loads, except for industrial-sized installations. And a cheap transformer can scale down the voltage to human-safe voltages. And slightly reduce the overtones on mains.

An interesting thing with a long LED chain is that if one LED gets a short, the voltage over the LED chain will decrease and the voltage/current over series resistor will increase. Besides extra heat in this resistor, another marginal LED could fail. I have seen some nice LED chains where every LED have shorted. I'm not sure if it's just some LED types that fails to short or if they normally go to open, but with 12 shorted LEDs in same chain I kwow that at least some LED may fail with a short.