This is not really an answer,
but rather a report on an experiment.
After the discussion here I got very curious and wanted to compare what I would call a "yeast cake" (even though this is against the traditional definition, but the texture is more or less that of a spongy cake/quick bread) to the "same" cake made with baking powder.
To perform the comparison I divided all ingredients in two and the only difference between them was the leavening.
I tried to keep it really simple, and threw together some ingredients that I had in the house (using a simple quick-bread/muffin method).
Just so you have the feeling of what the batter was like, I will add my experimental
materials:
For each cake I used:
2 ¼ cups soy milk
¾ cup baking margarine
3 cups all-purpose flour (type 550)
2 cups raw sugar
¼ cup cornstarch
½ tsp ground vanilla pods
Then for one (A) I added:
1 ½ tsp dry yeast
2 tbsp sugar
and for the other one (B) I used:
1 tsp baking powder
½ tsp baking soda
2 tbsp cider vinegar
For both I warmed up the milk and margarine just enough that it melted and added the vanilla, then let it cool down.
For A I then added the extra 2 tbsp of sugar and the yeast, and let the yeast get activated and work for an hour - the soy milk curdled and completely separated. When I made B I added the vinegar to the milk mixture and mixed - the soy milk got thicker and curdled a little. The baking powder and baking soda I added to the dry ingredients.
After waiting for an hour for A to do its thing (of course B was ready to put in the oven instantly), I poured the milk mixture into the combined dry ingredients and gently stirred, just enough for the components to combine. I poured the batters into oiled and floured pans and baked each cake on its own in a preheated oven for 40 minutes (this is when both passed the skewer test) at 350 F.
Results:
Both cakes rose to 2.5 times the batter height/level. However, B rose more evenly, whereas A rose a bit less towards the edge of the pan. B smelled like a normal cake/quick-bread, but A filled the house with a "doughnuty" smell (the most scientific term that can be used here would probably be: super yummy). When cooled and cut, both had a really (equally) nice bouncy, fluffy, slightly crumbly spongy texture. A had a bit more and larger trapped bubbles, see figures 1 and 2.
One of my taste testers (or is it test tasters) is quite sensitive to baking powder, and said B tasted a bit too much like baking powder. Everyone agreed that A tested a bit more complex. Both cakes would probably have been better with some nuts or chocolate or fruit, but I avoided these in order to have less complex experimental conditions, to make the cakes easier to compare.
Fig. 1: Side-by-side comparison of the yeast leavened "cake" (left) and the baking powder leavened cake (right).
Fig. 2: Zoomed in image of the yeast leavened "cake" (left) and the baking powder leavened cake (right).
The experiment was performed using an electric oven as I don't have a bread machine. A comparison between this two would be interesting as well.
Best Answer
You can proof your yeast to see if its still alive:
Heat approx. ½ cup (100ml) of water to about 115°F (45°C). Add a tablespoon (10g) or so of sugar, stir. Water should still be above 105°F (40°C). Add a teaspoon of yeast, stir. Within 5 minutes or so, the mixture should be thoroughly foamy.
If its not thoroughly foamy, yeast is bad (dead), dispose of it.
(Note: Metric conversions above are rounded, just like the imperial units. Don't use these conversions for baking, but proofing yeast doesn't need anything exact.)