We have the option to whitelist traffic in the IPS, but wouldn't it be a good idea to insert RETURN rules into the IPS chains so that packets will never even hit the IPS when whitelisted?

There are usually two reasons to whitelist something: a) it triggers some error in the IPS which is why we totally want to circumvent Suricata, or b) performance because Suricata does not need to scan everything. In both cases a RETURN rule would make sense to me.