A record 15 players are within two strokes of the lead after round two, the most in 108 years, with some 42 players within three.
At two under and two back, Scheffler is one of the swathe of players chasing halfway co-leaders Smalley and McNealy after posting a second-round one-over-par 71.
But the world No.1 and defending champion was less than impressed by the course set up at Aronimink Golf Club after five holes yielded more three putts than birdies on Friday.
"You've just got to continue to try to hit good shots and most of the pins today were, I mean, kind of absurd," Scheffler said after finishing the day in a tie for ninth at two under for the championship.
"They were just so far into the areas where we thought the pins were going to be, and then they just - like the one on 14 was probably the hardest pin that I've seen in a long time.
"Just because there's literally just like a spine (in the green) and they're like, 'Oh, we'll just put the pin right on top of it.' And you're like, 'All right, well, I'll see what I can do.'"
Scheffler, who had a share of the 18-hole lead for the first time in a major, did not find a fairway until his ninth hole, but he remains favourite to go back-to-back.
Smalley carded a 69 and McNealy a 67 to jump to four under for the tournament as the Philadelphia chill and the devilish set-up continued to bite the game's best players.
Australian No.1 Min Woo Lee rallied with three back-nine birdies to carve out an even-par 70 to sit just one shot off the pace entering the weekend.
Chris Gotterup had enough Jersey toughness to handle the cold wind and treacherous greens, closing with three-straight birdies for a five-under 65.
The low round of the tournament thrust Gotterup to three under alongside Lee in a six-way share of third spot.
South African Aldrich Potgieter, one of seven first-round co-leaders with Scheffler, bogeyed his last two holes in a round of 70 to be three under.
At just 21, Potgieter was looking to become the youngest golfer with a 36-hole lead at a major since Tiger Woods' historic win at the 1997 Masters, before his late stumble.
Former Masters winner Hideki Matsuyama is also in the chasing pack just one back after shooting 67 in his quest for a second major.
Rounding out those at three under are American Max Greyserman (69) and German Stephan Jaeger, who parred all 18 holes in his round of 70.
This is just the fifth PGA Championship in which as many as seven former major champions are within four shots of the lead after 36 holes - and the first time in 20 years.
Only 21 of the 156 starters are under par.
Jason Day, the last international to win the PGA Championship back in 2015, is among those in red figures at one under after also posting a level-par 70.
Fellow Australian Cameron Smith (71) drained a 60-foot birdie putt at the last to pull back to even for the championship and snap a streak of six straight cuts at the majors.
McNealy backed up with two dropped shots over the last three holes to invite the chasing pack, including Smith, back into the championship.
After he was given a two-stroke penalty for being late in the opening round, South African Garrick Hugo missed the cut on Friday by one stroke.
With AP
