Linear voltage regulator failure?
Good news. Neither the regulator nor PCM chip are dead. Glad components nowadays are pretty tough. I put U4 in a place of U2 and it showed correct output 3.3V. I tested U2 regulator outside on a breadboard (it was painful to solder wire leads to SOT23-5) and frankly it worked perfectly fine. So I put it back in place of U4 and the board is working just fine. I still don't fully understand what was happening. Close visual inspection was the first thing I did and surely there were no visible shorts between the pins.Could it be some solder flowed under the chip and created short that way? Thanks everyone for your time>