[trask768]

I've always heard a larger filter drops your oil pressure once warmed up

A bigger oil filter is not going to cause an oil pressure drop. In fact, it should help an aging oil pump perform better, as it is easier to pump the oil through the filter.

it takes more oil to fill to capacity

A bigger oil filter will slightly increase how much oil it takes to reach capacity - however it's very small difference (in my case about 1/2 cup) and easy to either compensate for the difference by adding extra oil or, in my case, ignore entirely since my oil level indicator still showed full.

in which case the engine has to move more oil through the engine, which can then cause more work for the pump

You aren't moving any additional oil through the engine. Your oil filter should have an anti-drainback valve to prevent oil from escaping the filter when the engine is off. Your pump will have less work to do since it will be easier to push the oil through the filter due to the greater surface area of the filter.

or heat problems

You aren't exposing the oil to any additional sources of heat, so the larger oil filter will not cause any heat problems.

If my bypass valve pops at 20psi, and while running at hiway speeds my engine sees about 40psi, then my oil bypassing the filter most of the time, right?

That's a common misconception about bypass valves, although your conclusion isn't necessarily incorrect. They don't operate on system pressure, they operate on differential pressure, which is the difference in pressure between the inlet of the oil filter and the outlet of the oil filter. Under certain conditions, a very dirty OEM filter may have a 20 psi pressure drop. Under the same conditions, a longer filter (with double the surface area) would probably have around a 8 psi pressure drop. Pressure drop across a filter is directly affected by several variables - as you increase these things, you'll increase the pressure drop across the filter: viscosity of the oil, flow rate of oil through filter, time in service of oil filter. However, there's an inverse relationship between the pressure drop across the filter and the surface area of the filter. In other words, as you increase the surface area of the filter, you'll decrease the pressure drop. In addition, an increase in oil filter surface area will actually decrease the effect that higher oil visocities, higher flow rates, and longer time in service will have on the pressure drop.

With or without bypass is still debated.

You definitely want a bypass on your oil filter, especially for racing. Without a bypass, as it gets dirtier, an oil filter will restrict flow more and more (and decrease oil pressure more and more) until eventually, your engine is so starved for oil that it locks up.