Hi, yes we measured at the correct pins, good point. We always tested the supply unloaded.
The whole story is the machine suffered a short between the heatsink (tied to the regulators input pin) and ground. The diode started to smoke so my collegue changed the L79 and diode, however he soldered the diode backwards, tried it and no luck, I believe the new diode was probably stressed at this point. I pointed out the fault and resoldered the same diode correctly this time. Switched on the supply and everything measured correctly plus the diode was cool to the touch. Later on we swithced it on again and the diode immediately got hot and burned. Same exact conditions though, the supply was never loaded for any of the tests.
We are in process of changing the diode and testing again.