The problem with putting my bypass cap to get more AC ripple in my feedback is that it made my PID controller very unstable. This is because its proportional gain is tuned to the sensitivity of my regulating MOSFET circuit. I turned proportional gain down and tried to just get my derivative gain up and it works now, but still a little unstable at start up (oscillates to saturation at startup) and I have less performance than I did before, but at least I know that the ripple signal has a better chance of being picked up by my control circuit in a real circuit.
I think the reason my PID controller was so unstable with the AC bypass cap added is because the ripple (5mVpp) is 160,000 smaller than my DC signal, and so the AC signal is getting a lot more gain, and I don't think my PID can be designed to control both. I am thinking of 2 feedback paths, one sensitive that is PID for the DC feedback, and another less sensitive separate feedback for the small mV ripple.