This opening begins by copying the Ruy Lopez/Morphy Defense for the first three moves, but White branches off with 4 Bxc6. I've read that 4 ... dxc6 5 Nxe5 Qd4 is effective for Black to recover his pawn - but what if White does not play 5 Nxe5, say 5 O-O instead? In short, why has this opening been largely ignored? Is there a disadvantage to White after 4 Bxc6?
This is called the "Exchange" Variation of the Ruy Lopez. Not only is there an early exchange of bishop for knight, but it usually soon leads to an exchange of queens on d4.
This queen exchange brings about an early "endgame," effectively cutting out the middle game. Most players are not particularly fond of the endgame, so they don't consider this an advantage, and therefore don't play this variation.
But in a famous game in St. Petersburg in 1914, the world champion, Emmanuel Lasker, played this variation against future world champion Jose R Capablanca---and won. By Capablanca's own admission, "Lasker had no superior in [the endgame]" at the time. On the other hand, he already (and later) feared Capablanca's middle game.
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It hasn't been ignored; this is called the Ruy Lopez Exchange variation, and is extremely popular in tournament play.