Purolator filter quality issue? is this supposed to be like this?

With the spring should be shaped it would be in permeant bypass if it's upside down.
True ... if the leaf spring is upside down, there's no sealing of the leaf spring on the end cap around the center tube.
 
Without seeing the dome end cap of the element, I'm not 100% convinced that the bypass is installed upside down. If it used the Champ Labs, Fram poppet bypass design with compression spring combined, that might be true.

Otoh, it could still function if the top of the poppet opens inwards and seals back to the dome endcap when it closes. That would be similar to how another Purolator bypass (enclosed interior coil spring with a phenolic seal top) works but didn't use the composite/nylon poppet shown. Then it would still have a separate stamped compression spring. 'To me' seems a more reasonable explanation.

Again though, as I've never seen any Purolator filter previously with the poppet type bypass shown, can't rule anything out. Why I asked for more information on application number, date code and purchase location.
 
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Otoh, it could still function if the top of the poppet opens inwards and seals back to the dome endcap when it closes. That would be similar to how another Purolator bypass (enclosed interior coil spring with a phenolic seal top) works but didn't use the composite/nylon poppet shown. Then it would still have a separate stamped compression spring. 'To me' seems a more reasonable explanation.
On Purolators like you've described (enclosed interior coil spring with a phenolic seal top), the sealing disc is not attached to the spring, but rather just sits on top of the spring, and the other end of the spring is retained by and against the metal "cage" that contains the spring.

In poppet type bypass valves like in the OP's filter, the spring is in compression and pushing up on the 4 tangs that are around the end of the spring. So the spring is pulling the nylon piece in the direction of the tangs. That means something on the other end needs to seal and stop the movement. See the last photo, the flange on the center tube side of the popped valve stops and seals it on the leaf spring on the center tube side. Here's a few photos of this type of bypass valve design.

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