I have been able to reproduce this bug consistently with a SOCKS5 proxy, even after reinstalling Firefox/Waterfox completely:
1. Select "Always Enable" mode.
2. Select "Enable for 'Always Enable' mode" in the "Bypass List" tab.
3. Add local address (not sure if correct term) exceptions - in my case for 192.168.0.2 (Pihole) I simply added 192.168.0.2
4. Click "Save Changes".
5. Close Firefox/Waterfox completely, then open it back up.
6. Go to the local address (192.168.0.2 in my case), it will fail to load because the proxy is running despite the bypass rules.
7. Go to the "Bypass List" in the SmartProxy settings and hit "Save Changes".
8. Reload the local address tab, and it loads instantly.
This is a very strange bug, which only seems to occur with local addresses. This doesn't happen with regular websites. Steps 5-8 are the actual bug that can be repeated, steps 1-4 are just the initial setup.