I bypassed my water softener and the water pressure in the entire house dropped. I though the opposite usually happens? Anyone have any ideas? Thank you!

Is the bypass actually causing a restriction? As in smaller diameter pipe, or a damaged pipe? Are all valves completely open or closed?

Typically you are correct... however those are a couple possible reasons for what you are experiencing.

The pipes appear to be the same diameter as all the other pipes I see running downstairs.

For some background info:
My water smelled like rotten eggs. Hot and cold. It's not coming from my well, we checked that water and it doesn't not smell. Thought it might be water heater and we replaced the rod in my hot water heater. That wasn't the problem. I believe it's my water softener. As a test I bypassed the water softener to see if we still had the smell. Once we ran water in the house the smell was gone. Then the drop in pressure. It's much lower than it was when the water softener was on. Flush the toilet and open a faucet and there's barely any pressure. I can't figure it out.

Must be restriction in by pass valve. Can you disassemble it?