Yes I know the output is not DC, without a filter cap I would expect that zener to behave like that, however because of the cap you see that the output of the bridge rectifier goes from ~160 and only goes down to ~75V (shown in last pic), well above the 18V zener breakdown voltage.This is a PFC. The voltage at the output of the bridge is not DC it is half sign waves. It should be 120hz 0 to 150 volts or 0 to 300V for 110/220 ac. The voltage on you Zener looks right to me.
When I first turn on a power line switching power supply I usually power the IC with a bench power supply (15 volts). Then I work on getting the FET/transformer high power parts work well. At the end I go back and work on getting power for the IC.
When the supply is not working well, or there is any problem, the IC may lose power and reset. This makes fixing the problem very hard. You may be looking for why the IC resets (lack of VCC) but the real problem is current limit or .....something very different.