Those two photos were more than all the verbage above that post.
Like Mr Cactus Jack said --> shorted regulator. End of story, look no further.
Input of 74VAC -- you should get (74 x 1.414) - (2 x 0.7) = 103.2 volts on your input. Rather high but not the issue as the System 1 regulator should be able to handle this. And you see nearly the full voltage on the output (102.7) -- the regulator isn't doing anything ... it's shorted.
Look at U1 -- what is the part number of the existing regulator?
If it is the LM317AHV - it's a known problem with that design. The LM317AHV can withstand an absolute maximum of 60 volts between input and output voltage. During normal operation - you have 102 volts on the input with an output of 60 volts --> a 42 volt differential and still within spec.
BUT if you were to ever short the output and during power-up period, you would have that 103 volts on the input and 0 volts on the output. Part would be running at 175% of absolute maximum ratings - that does mean and nasty things to these regulators. The National Semiconductor field application engineer (hopefully, they all found new employment by now) - actually said the power-up period would probably kill more of these than the shorted output.
If it's the LM317AHV, see if Jim has a resistor mod to change that to the more robust Texas Instruments TL783. This part can withstand a differential up to 125V. Same pinout (if I remember correctly) but requires different resistor values.