The 10k potentiometer forms a variable input attenuator to reduce the signal voltage reaching the isolation transformer, it also provides adjustment for various types of transformers. The transformer chosen can be anything from a small interstage coupling transformer salvaged from a transistor radio to a line transformer used in 70v speaker distribution systems.

If the turns ratio differs from 1:1, you need to connect it in step-down mode (lower impedance side used as the secondary winding).

Signal levels
A 100w amplifier driven to full output will produce about 28 volts of signal across the speaker line. Line-level signals operate approximately 40db below this, so some sort of attenuation is required. This attenuation is determined by the step down ratio of the transformer and the setting of the potentiometer.

NB: If the pot is set too high the isolation transformer will saturate or the auxilliary device driven into overload.
Happy experimenting!