You are slowing things down by creating lists and large strings you don't need. You are just examining bits of the bytes and convert two-bit groups into numbers. That can be achieved much simpler, e. g. by this code:
def convert(currBytes, nBits):
for byte in currBytes:
for p in range(4):
bits = (ord(byte) >> (p*2)) & 3
yield None if bits == 1 else 1 if bits == 2 else 2 if bits == 3 else 0
nBits -= 2
if nBits <= 0:
raise StopIteration()
In case you really need a list
in the end, just use
list(convert(currBytes, nBits))
But I guess there can be cases in which you just want to iterate over the results:
for blurp in convert(currBytes, nBits):
# handle your blurp (0, 1, 2, or None)