Troubleshooting is an art form, it seems best to begin with
the easiest and quickest things.  The only harm from a
reinstall is the time it takes and the need to do all the
updates and reinstall all the software and data files, if a
complete reinstall become necessary.

It does seem possible that the first item in the line that
had the surge might fail (like a fuse) and protect other
parts.  Have you checked the device manager for errors?

 It is quite normal for lightning to enter on AC electric,
pass through computer and modem, then exit on phone line.
Only after electricity passes through everything in that
circuit, does one thing fail.  A most common failure point is
the DAA section of a modem.  IOW it is common for lightning to
pass through computer from AC electric and not damage
motherboard.

 All minimally acceptable computer manufacturers provide a
comprehensive set of diagnostics.  First use those diagnostics
to only verify hardware - without any use of the XP OS.  If
hardware passes, only then is the OS considered later as a
reason for failure.

 Modem diagnostic test of hardware is unique.  First CPU
talks directly to modem's computer chip.  If this
communication is OK, then additional tests must be executed to
see if modem's computer can then talk to phone line via DAA
section.

 Restore OS is a last thing done long after other properly
recommended ideas are verified; such as review Device Manager,
review system (event) log, and run comprehensive diagnostics.
System restore is most often used by techs who never really
learned how to fix computers.  It is quick, dirty,
unnecessarily destructive of data, and teaches nothing.
Everything a weak tech wants.  First learn the symptoms of the
problem - in part because you don't want it to happen again.