Hi chuckwin,
When SigmaStudio compiles a project, each block gets an independent allotment of processor time (instructions), parameter storage, and data memory. The only connections between blocks is their pins you wire together. Thus, with the mux in the position shown below, both the filter and the delay are bypassed as we would expect. When I tested this project on my ADAU1701 board, switching the mux produced an audible difference in "spaciousness" via headphones.
Interestingly when listening to just the one active channel, I couldn't hear any difference when switching the mux. Apparently the ear isn't very sensitive to this sort of change. Perhaps that explains the effect you're experiencing.
Best regards,
Bob