Electronic – Why doesn’t the car hardwire USB C loom work

USB is 5 V. A difference of 7 V at for instance 1 A would cause a power dissipation of 7 W if a common linear regulator would be used, which would melt the device, so they use a switching regulator, aka SMPS (Switch Mode Power Supply), aka "switcher". There's no transformer, since you don't need isolation, but there's an inductor.

A linear regulator acts as a variable series resistor, whose resistance is regulated so that the output voltage remains constant. But that means that all the current which is consumed by the load also goes through the regulator, and that's why it's so inefficient, especially when the difference input-output voltage becomes large.

A switcher will use input current to build up a magnetic field, and then use that magnetic field to create the output current. The name switcher refers to the high frequency at which this occurs. So it pumps a small amount of energy in the coil, which releases it again, again energy in the coil, etc. The control circuit will vary the duty cycle of the switching to keep the output voltage constant.

Since there's no series resistor a switcher can be made much more efficient than a series regulator. Depending on parameters like input and output voltage efficiencies of more than 90 % are possible, that means that 1 A out at 5 V will only cause 500 mW dissipation. (Remember, the linear regulator was 7 W.)

Most of those adapters will use an MC34063 switcher, mainly because it's dirt cheap, although it doesn't perform as well as more recent switchers.

in most cars the cigarette lighter socket is on the accessory circuit and is only active when the key is in the accessory or run positions.

some cars have it always live.