if a flyback is short circuited, its output voltage simply drops, a flyback, being transformer isolated, and delivering power on the off-stroke of the fet, does not deliver enormous current into a short......the output voltage just drops, and the micro could detect this and simply turn off the pwm controller.
So the micro would be able to perform the shutdown no problem, but its just a case of whether or not the safety and regulatory agencies would agree to having a micro do this function?
I am afraid that in UK, the SMPS industry is pretty much all gone, -gone to China, so there isn't too much opportunity to go to places where smps's are being made, as this doent happen very much on the green pastures of the UK.