sorry you are wrong...you are not looking at the whole system.
reducing friction ALONE would increase velocity if NOTHING ELSE CHANGED.
but in this case things do change...partially because of the reduced friction.
the bullet moves forward, easier intially. this increases the volume of the combustion chamber( volume behind the bullet).
larger volume, less pressure,
less pressure slower velocity..
the " all things being equal" is what gets you...all things are not equal.
Since burn rate is a direct function of pressure (the exponent may be greater than 1 also) all things are NOT equal.