While debugging interesting side-effects, I decided to take a "shortcut" and rollback project sources to some earlier version. Just checking when the weird behaviour start to happen.
Found out that SVN rollback is actually a backwards merge - with the usual, expected and dreaded merge conflicts.
Successful rollback does not necessarily produce compiling code. You got to do rollback - to same version - couple times to catch all merge conflicts. Seems to depend on order of files.
Looking for SVN replacement.