Maybe I was misunderstood- I don't think the exchange is "harmless" it's just that black's position is more to my taste.
Ruy Exchange--Why not 4...bxc6?

Tim Taylor was advocating 4...bc6 in his Spanish repertoire book (on the modern Steinitz). I wasn't convinced at all, but then I wasn't convinced by any Taylor book...
The more I read this book the more I realize how much of it contains just plain wrong information. I need to go back to Amazon and update my review -- he will not be pleased.
In his KID book, he says 99.999% lines are winning for White in the FPA.

White has no advantage here, so its safe to assume that 5.Nxe5 is nothing special.
5.0-0 is the right move, when Black is alive, but not well.
I would also like to stress that whoever believes that the Exchange variation is "harmless" is simply uneducated. Black has just two ways to proven equality (4...dc6 5.0-0 Bg4 6.h3 h5 and 4...dc6 5.0-0 Qf6) but neither of them is clear of pits.
Recently Caruana fell into deep trouble against Najditch at the Grenke super-tournament employing the "solid" 5...Qf6 variation, which he handled rather poorly. Actually he won the game, but his position was certainly not enviable.
I thought Qd6 was a move.

5...Qd6 6.Na3 is somewhat clumsy to meet- at least in practice Black isn't scoring well.
5...f6 is also OK, but not terribly ambitious- Black declares he is satisfied with a draw, and willing to suffer (very mildly) to achieve it.
I've never understood why anyone would …
... you have to stop thinking you know more than everybody else ...
Is that what "I've never understood" means? And, by the way, has abiogenesis23 been here since 2013?
I've never understood why anyone would …
... you have to stop thinking you know more than everybody else ...
Is that what "I've never understood" means? And, by the way, has abiogenesis23 been here since 2013?
Abio said that as a statement not a question. …
Was it necessary to ask whether or not abiogenesis23 had ever understood something? Wasn't that something that abiogenesis23 was in a position to know?
I've never understood why anyone would ever play the Ruy Exchange, throwing away the precious light-squared bishop for basically nothing.
…
...
... Read the entire quote. He is pre-supposing he is right and everyone else is wrong.
I still do not see anything about everyone else being wrong. I suppose it could be argued that abiogenesis23 was presupposing "basically nothing" as compensation for giving up the bishop for a knight, but the I've-never-understood part of the sentence seems to me to indicate a recognition of possibly incomplete understanding. Anyway, you are reacting to a 2013 post.
1. e4 e5 2. Nf3 Nc6 3. Bb5 a6 4. Bxc6 bxc6 5. Nxe5 … White has no advantage here, so its safe to assume that 5.Nxe5 is nothing special.
5.0-0 is the right move, when Black is alive, but not well. ...
"No one plays 4...bxc6?, since after 5 0-0 d6 6 d4 White is a whole tempo up on the Steinitz Deferred [(1 e4 e5 2 Nf3 Nc6 3 Bb5 a6 4 Ba4 d6 5 Bxc6+ bxc6 6 d4)]." - IM Sam Collins (2005)

Fischer in game against Gligoric in "60 Memorable games" comments on 4...bxc6, but can't remember what recommends.
You have the white pieces which means you are the one pushing for a win. Trading pieces and giving up the bishop pair doesn't exactly help with that. Trading simplifies the game closer to a draw.
"Black has two bishops, while White has a better pawn-structure. After d4, exchanging the black e-pawn, the white kingside majority is healthy (meaning it can create a passed pawn) while the black queenside majority isn't." - IM Sam Collins (2005)
http://www.chessgames.com/perl/chessgame?gid=1258181

I used to use this line.
It's not great:
It's not great, most of my games looked something like the line above.
abiogenisis, you apparently have misunderstood. If 4. Bxc6 bxc6, 5. Nxe5, then what is Black's response?
Your answer, ...Qd4, seems to assume that Black's fouth move was the traditional dxc6. My question was addressed to the question posed by the OP, namely, what is wrong with 4 ...bxc6? My suggestion is that one thing wrong with it is that Black cannot play Qd4 after 5. Nxe5.
How does Black fare in that line after 5. Nxe5?
Yeah I did, someone already mentioned that.