I recently updated to PhonerLite 2.68. My options were set to:

Options->Sound Device->Microphone->Default
Options->Sound Device->Speakers->Default"

After the update to PhonerLite 2.68, my Sennheiser Presence UC headset was no longer recognized as the Default Communications Device -- or at least I assume that is what was happening, as I no longer heard anything in the earphone.

I then uninstalled PhonerLite 2.68 and reinstalled PhonerLite 2.58. The problem disappeared, i.e. I could hear and talk into the headset!

Just to be sure, I uninstalled PhonerLite 2.58 and installed PhonerLite 2.68 again and once again heard nothing in the earphone.

I therefore reverted back to PhonerLite 2.58.

Any idea what could be happening? I made no changes to the Options when moving between versions ...

Best regards,
Bruce

I don't see "open capture sound device" or "open render sound device" in the log at all.

It does not appear for either version 2.58 or 2.68.

Version 2.68 simply ignores the default communication device. The default device has to be the headset earphones, or I can't hear the conversation. I can even set the default communication device to the speakers. It makes no difference. It is just ignored.

This happens with both of my headsets. One is a Sennheiser Presence UC, the other a Crystal SR2822. 

The only thing the two headsets have in common is that they both work through USB, the Presence UC with a wireless dongle, the Crystall SR2822 wired.

Here are a few other things that are interesting about version 2.68:

If I set the earphones as both the default device and default communication device, then everything works as expected. I hear the music in the earphones and during the call I hear the conversation and the music is muted.

If I set the speakers as both the default device and default communication device, I hear the music from the speakers, but when making a call neither the music or the conversation can be heard on the speakers! It doesn't matter what the default communication device is. The same thing happens.

If I set the default device to my earphones and the default communication device to the speakers, then I hear the music in my earphones, and during a call I hear the conversation in the earphones -- but the music continues to play, as it is *not* muted during the call. This is very strange.

I can't see any output regarding sound devices in the log, because you didn't start any call. Instead of starting a call you can also click on the microphone and speaker button in PhonerLite. After that you should hear yourself.

I see that it doesn't work at your PC. But I checked it with multiple sound devices here at some PCs and could not reproduce the problem. 
You can select the sound devices explicitly in PhonerLite - then it works?
PhonerLite is just a hobby project - I can't test with all possible environments. I hope you understand that.