this is a 3phase a/c condensing unit of a split system with a 48.1mca and a 70mco. if what you're saying is true about 500% being normal then why is everything calculated for 125% for motor inrush?
You are misinterpreting something here. The "125%" is for sizing of conductors, that has nothing to do with "inrush". All induction motors are nothing but a short circuit for the instant that it is first energized and the magnetic fields are not yet established. This is the true definition of "inrush current" because there is no impedance yet, only resistance of the winding conductors, which is very low. So theoretically that can be as high as 2000%+ of FLA, but only for about 1 cycle. After than, the magnetic fields come into being and interact to drop the current to 500-600% of FLA, until the motor reaches about 80% speed. After that, it drops to FLC fairly fast.
it's on a little retail shop and it just seems odd to me that the inrush would exceed the amp rating of the theaters coming into the building. I was thinking that the smaller conductor not being able to supply the required amperage was causing for the voltage to drop and amps to spike.
You don't size conductors for inrush or starting current and not even the transformers unless you think there is going to be a problem. All transformers have what's referred to as a transient load capacity before they show a significant voltage drop, but it's based on kVA for short periods of time. So the higher the starting current and/or the longer it takes to start a motor, the more you run into a problem. That's typically something the PoCo will tell you, either directly by stating the maximum starting kVA, or indirectly by telling you the maximum size of motor you can start without having to use Reduced Voltage Starting. If someone is adding a load that is causing a VD, and in the permitting process, nobody called the PoCo to tell them what they were doing, it might be a violation.
Having the conductors being too small will cause them to heat up and act like resistors to drop the voltage, which is actually a form of Reduced Voltage Starting that is available (albeit using actual resistors, not the conductors). So although not good for the conductors themselves, it is actually probably HELPING the situation a little. Again, NOT the way it should be done, I'm just pointing pout that your thinking the conductors is the CAUSE of the problem is not correct.