To investigate the load-deformation mechanisms of dynamically driven piles in mudstone foundations and clarify the influence of installation disturbance on pile bearing performance, this study addresses the practical engineering issue of abnormal bearing capacity caused by mudstone softening upon wetting and strength degradation after disturbance. The work is based on a high-rise residential project in Jiaozhou, Qingdao, where the site features a typical soft rock foundation that is prone to slaking in water and exhibits significant surrounding-soil damage during dynamic pile driving. Four PHC pipe piles were subjected to axial compressive static load tests to systematically examine their load–displacement response, rebound ratios and pile-length effects. An ABAQUS finite-element model incorporating pile-surrounding mudstone damage was also established for validation. Test results indicate that the load–displacement curves fall into two categories: gradual-type and abrupt-type. Gradual-type piles SZ1-2 and SZ4-1 did not reach the ultimate state under the maximum test load, exhibited rebound ratios exceeding 80%, and showed predominantly elastic deformation. Abrupt-type piles SZ1-1 and SZ4-2 experienced overall shear failure or punching failure of the end-bearing stratum. Pile length significantly affects bearing capacity, with 26 m piles demonstrating higher ultimate capacity than 19 m piles. Numerical results show that the finite-element model incorporating mudstone damage agrees well with measured values, with prediction errors controlled within 10%, outperforming the model that neglects damage. Further analysis reveals a nonlinear increase in end-bearing resistance with load, and at the maximum load level its contribution may reach up to 60%, indicating a transition of the bearing mechanism from side-dominant to end-dominant. The ratio of pile-end settlement to pile-head displacement increases in a stepwise manner with load and can reach up to 27.47%.