Where should I look for transformer inductance discrepancy?
The proper test is applying the 120V AC and if this implies an inductance of 106 H then that is what I'd assume. So why does the meter indicate a lower inductance? One thing that might indicate a "problem" is the measurement of 7.7nF. If you take the inductance reading of 106 H and calculate the resonant frequency with 7.7 nF you get 176 Hz and this is much to close to make sense of any inductance measurements on your LCR bridge.

Another factor is that the eddy current induction into the laminations rise with some factor of frequency (I think it's like skin effect so it rises with \$\sqrt{F}\$ from memory). Eddy currents are like partially shorted turns and therefore have the effect of lowering the perceived magnetization inductance of the core.