What caused this burn out?

[reset]

Although repairs have been carried out the burn pattern can still clearly be seen on the wood however very little if any to vegetation close by.
The heat clearly came from the drop wire running to ground level as the wood is only burned on one side and only to the top of the drop wire.
The drop wire is on the south side of the pole.

It's hard to reconstruct an event after repairs are made. I've seen this type damage from wet oak limb contacting two lines, kudsu vine growing up the pole and contacting the high line.
Was the racoon guard there before the event? (The angle iron with the barbed wire is what I call a racoon guard.) Sadly racoons are large enough to bridge the gap between the line and the ground wire and they do like to climb poles.
The fuse will protect a wire overload but it takes much less power to burn a power system out than it takes to blow the fuse. I was involved in a rebuild that burned about 24" of 3/8" X 6" buss bar. The system was 3 phase Delta (no direct ground, it finds ground threw faults). Two of the fuses blew which would have normally killed power but the third line was finding a return path threw the equipment ground system and a power feed in a neighboring distribution center.
We put out the fire and it would restart. We had to pull the third fuse under load.

Anyway, it could be a small animal bridged the gap or a wet tree limb found its way into that spot? As you say it appears to have started there and went down.