voltage regulator giving lower output than expected
It appears that your neutral and ground have an "offset" voltage of about 1.8V DC.  So, when you measure the output of the regulator, you only see about 1.5V.

There is definitely a serious problem when neutral and ground are not at the same voltage level.  It appears that your voltage converter is one of those cheap, non-isolated supplies and it is very dangerous to use in earth-grounded circuits.  If you grab the lamp and your feet are wet, you could end up electrocuted!