Are you sure about the hardware ? Current limit resistors ?
An AVR getting warm sounds supicious.
If you don't have an external crystal, the PLL at 32MHz has nothing to sync with. Yeah, the internal RC oscillator. But that's a poor reference for the PLL.
Your program spends a lot of time in the ISR. Bad practice. Set a flag in the ISR and do further handling in the main loop.
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