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Hmmm...I have made several of these regulators without problems. I pulled out another unmodified one I had lying around and tested the voltages. There is some variability with the output voltages at 12 volts input. 12 volts input delivered 5.371 volts output. I think an output of 7.6 volts is out of specifications for a properly functioning regulator circuit. I attempted to attach two pictures but this sites uploader would not work. Did you by chance measure the output voltage with an input of 12 volts prior to the modifications? I suspect that you may have got a malfunctioning regulator circuit to start with.
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Just out of curiosity, can the enabling of the internal 8MHz clock be done with the ATmega168 microcontroller using the same Atmeg328 on a breadboard file and following the same procedures as described?