Fashionable at the time I guess and less noise, but it's a simple supply.
It looks like only three of the four diodes got toasty on the PCB. In a full bridge, if one diode fails, you get half wave rectification and all seems ok, although ripple goes through the roof. I've situations in amplifiers where a pair of diodes in a bridge have failed on a CT +/- supply and the thing still works, albeit with a significant level of hum and lack of power.
Something caused them to get cooked. Realistically, it can only be a shorted diode (that opened up later) or the 6800uF cap. The 7805 is not to blame- it won't allow more than 1A anyway, let alone when in free air- it would shutdown well before then from internal temp rise.
Toasting up a PCB like that takes time, so it's not a random event, more a long term slow-cook IMO. Strange.