Should I Circumvent the Pressure Regulator or Cap it for a Gas Line Pressure Test?
My gas line can't be pressurized since there is a pressure regulator installed after the gas shutoff valve.


That's... not how it works. Regulators don't vent in an over-pressure situation, they just close. If it's venting, then you have a bad regulator.

You should have tested with your regulator in position. Your pressure test did not test the regulator for leaks, and it should have.



Your pictures are a little hard to see, but here is an image that I think matches your setup: regulator before the meter, test point after the meter. Your pressure test should be testing the parts I have colored red, plus the piping and appliances inside.