If "Ye" Means "You All", Why "Ye Old Shop"? [Link]

http://fluttershyponders.tumblr.com/post/74486871143/pinkie-yeah-and-how-come-ponies-keep-not

Fluttershy: “I think you might be referring to the Ye Olde Pone Dialect of our fore-stallions. Or High Canterlot as everyone calls it these days. I think it fell out of favor around 500 or so years ago when Celestia became very relaxed in her rule, leading us into the near-self-governance and not even she used it, finding it too uptight. Princess Luna may very well be the sole user of the High Canterlot dialect left in Equestria…Which is a little sad, when you think about it…”

Okay, serious answer time.

There are two distinct uses of "ye”: The first means “the” and the second means “you all” (back when “thou” meant “you” in the singular). These two aren’t related.

The first use (in “Ye Old Shop”, for example), actually comes from an letter called thorn (uppercase: Þ, lowercase: þ), which represents the “th” sound. (It survives today only in Icelandic.) The word “the” used to be written as “þe”, but people started using “th” (probably after the French conquered England). Despite this, some people kept the thorn and used “y” as a substitute, because printing type from other countries didn’t have the thorn. This results in “ye” meaning “the”; it does not mean “you all”.

EDIT: The title of this post was originally “If ‘Ye’ Means 'The’…”, which does not reflect the issue being discussed.