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I don't think what they said is actually a problem, it's just a back-justification for the original trope. Daisy chaining them and strictly sticking to only the few appliances that would fit in one extension strip is fine. But that's complicated to explain, it's better to just tell people not to do it rather than expect them to understand what's going on
A couple things that can happen...
plugging in too many appliances over several daisy chained power strips trips the circuit breaker because too much current is being drawn
if the country you live in has lax electrical safety standards then, yes, perhaps you can overload the daisy chain without tripping the main circuit which would lead to overheating
When the breaker trips then the fundamental issue is unlikely to be present. But to be able to push enough current to cause it to break the connection needs to have a sufficiently low resistance. If that gets too high it will never break, even if you short the cables. And that will result in a fire, because the protection does not work anymore. That is the dangerous part.