Ok, so here's the deal. I'm working on a pretty major case mod. I decided to use an exceptionally small psu and modify it into what will basically become a laptop power brick. The 12v out from the psu will power a dc/dc itx power supply to power the cpu and drives.
So, I wired all the yellow 12v wires together and all of the black - wires together so that the two 12v rails would be in parallel adding their max amperages. 16+16=32amps 12v current which should be more than enough for what I'm using. So, since the dc/dc power supply doesn't put out enough power for the gpu, I wired the gpu in parallel from the 12v source before reaching the dc/dc psu and since the external psu has 32 amps, this shouldn't be an issue.
The problem is that when I start the external psu by shorting the green wire to ground, my multimeter reads 12v as it should, but when I start the computer (dc/dc psu and the itx-mobo and drives) the 12v from the external psu drops to 10v. This results in the computer repeatedly restarting. Gets through the bios and when it attempts to boot from cd or hard drive, it just restarts the mobo. Why would this happen, and how can I fix the voltage drop?
Where are you measuring and how did you attempt to tie them together?
The attempt to merge all the 12 V lines may have resulted in a high resistance junction that is causing you a significant voltage drop, also try to minimize the number of connectors you pass through, each connector has a significant amount of resistance associated with it since the pins don't meet perfectly.
Except you just made a false assumption about how rails on a power supply work.
The PSU has a single 12 V source, from this it splits into two large traces on the main board and passes through a pair of shunt resistors that monitor the current, if it exceeds 16 A through either shunt the PSU will trip and turn off; however, this does not mean that you can draw 16 A through each rail for a total of 32 A because the 12 V source likely doesn't support it, most dual rail units rated for 2 16 A rails would likely have a combined capacity around 28 A unless otherwise stated.
If you are seeing that large of a drop right at the PSU's main connector that implies that it just isn't able to generate the necessary current on it's end, is it an older unit? It may have finally failed, did you test it before you attempted to use it in this configuration to confirm it was functional or is it still in a state that you could hook it up to a simple system to confirm that it is functional?