Sorry to bother - I don’t know how it happened but I could fix it this way:
I created 2 new shortcuts with following targets and launched it:
C:\Program Files\BraveSoftware\Brave-Browser\Application\brave.exe" --profile-directory="Profile 1"
and
C:\Program Files\BraveSoftware\Brave-Browser\Application\brave.exe" --profile-directory="Profile 2"
Profiles are back in switching menu. Leaving it here hoping someone finds it helpful! And I hope developers can trace why it happened!