The galvanized is probably all clogged up assuming there isn't a shutoff valve somewhere that is only partially open. See, for any sized pipe (even if it was pinhole sized) will show the same pressure when everything is off. However, the flowrate capability will be quite different for different sized pipes. Measuring pressure doesn't tell you much at all. A bit better measurement (in regards to pressure) might be to measure pressure at one fixture and then turn on another fixture nearby. If that other fxture has a low flow (such as a lav faucet) and the pressure drops like a rock, that means that the fixture is exceeding the plumbing capacity by quite a bit. This means there is a restriction which could be either clogged up galvanized pipes (most likely) or a partially closed shutoff valve in the line(s) that feed the upper floors.
The pressure you measured at the upper floors was lower due to gravity head. For every foot you go up, expect to lose about 0.5 psi. If the hose connection was at the 1st floor and the other measurements were at the 2nd floor (roughly 10' or so in elevation), you would expect the pressure to be lower by about 5 psi.