Proper way to provide +5v Arduino power & gracefully handle USB cable to upload

Made a project box, with 2s 18650 battery @ 7.8volts (more or less) - to a voltage step-down regulator, to output a safe and efficient +5v to the Arduino Nano. I prefer to use step down board instead of the onboard linear regulator for battery efficiency and power loss due to heat. There are other peripherals attached, like lcd screen, etc… The +5v external source is tied into the “+5V” pin of the Arduino Nano.

My power circuit provides around 4.9 volts when everything is running and on. If I disconnect my power circuit, and plug in USB cable from computer to upload sketch, the power appears to drop below 4.6 volts. Unfortunately, I can not test my project stable without the external power since the voltage is too far below 5 volts on the usb-cable only power.

If I plug the battery in AND the USB cable at the same time - my multimeter will get confused jump between different values, at this point I do not trust - this can’t be safe, and obviously throws off my analog inputs to reference voltage sensors.

Is there another circuit I should be installing between my external power supply and the Arduino Nano that will automatically level itself out when I plug in the USB cable to upload a sketch and debug? Or a different way I should be doing this? I am confused, please help.

Nano has a schottky diode in the USB line to protect the computer from reverse voltage, it drops about 0.25 volts, thats why you see less than 5V on the 5V pin, it's OK to plug in your computer with the Nano working, only problem is, like you say, if you unplug the external 5V your AREF voltage falls by about 0.25V. Look at "D1" at bottom of schematic.
Nano Schematic

I do not know what voltage to expect, when 4.6 volts being supplied via USB, and external power is 4.9 - multi-meter jumps from one voltage to another. I have no idea how the 3+ other modules handle to this variance.

My only thoughts were to hack apart USB cable / socket and remove +5V wire. That power is insufficient anyway - and does nothing but present more trouble.

Where are you testing voltage (red lead / black lead)? What is the current rating of your external supply? How much current are you drawing through the Nano?