I don't see any reason why the bottom of that FOF should be intangible. Probably reusing tags/laziness, because intangible bottom is also featured on that makeshift ladder. My guess as to why the map maker didn't simply use a new FOF there of all things.
The bottom FOF allows you to be intangible to surfaces because it is intangible from the bottom until you leave it (It's how the FOF coding works) But as soon as you move to the sector above, knuckles isn't allowed to climb no more, gets into his ball, then you clip up to the surface of the first FOF as soon as that happens and get crushed between the zero-height.