ym42

Thanks for all the advice. How I found the leak? First, a stethoscope method. Then, my own fingers - turn the car on and quickly get under before the pipes get burning hot. Could feel it with my hand, and confirmed by putting a damp cloth over that place and watch it blowing away from it... It was.. hmm. informative... Local Meineke agreed to look at it...
Regarding the P0430 code, it is often confused with P0340 LOL! The repair manual says that one of the reasons for the Catalytic Converter Efficiency Below Threshold Code is an exhaust leak. Its just that first it was not apparent, and now it is...

Interesting enough, while now the issue became quite apparent at 115k miles on odometer, for the first time the code popped up at 78k, and if I knew it was the cat converter, they would have replaced it for free... alas...!

ym42

Here is the video I shot with iPhone, YouTube link. You can see the area darkened by carbon deposits from exhaust above the seam, on the thermal liner above the cat....
http://youtu.be/J9dG_PZLP_4

ym42

Took the car to Ford dealer first, they recommended me to go to local Meinecke shop, which turned out to be very helpful and we were able to confirm a leak at the driver's side converter seam. They quoted me 220$ all included flat rate which seemed reasonable, since taking off o2 sensors x4 and welding does seem to take some time indeed. Mechanics were not able to find the leak by themselves until I pointed it out to them by getting a small mirror close enough to produce a loud exhaust gas hissing. In a hindsight, I wish I knew of this problem earlier and did not spend unnecessary amount of money on new set of o2 sensors which were probably just fine... :-(