The pressure switch must be located very close to the pressure tank. If not, the pressure switch will bounce the pump on and off rapidly. At what flow rate where you figuring the friction loss? The pressure switch just needs to be set high enough to overcome the friction loss and still have 40 left. Also you won't see the flow rate and pressure change as the pump cycles if the pump is not cycling. A Cycle Stop Valve will hold the pressure constant instead of letting the pump just cycle on and off and the pressure keep going up and down.