Steve, I think that you fouled up the math in your example a second way in that a tire has a top and a bottom, hence the height differential you provided in your example has to do with the and we're talking about altering the tire's height by manipulating tire dimensions. Fred did not change the rim radius of his wheel. He changed the diameter and section width of the tire, thus changing its height and said difference needs to be doubled because a tire sits on both the top and bottom of wheel(rim).
Please correct me if I'm wrong, because this is all pertinent not just to rider comfort, but, most importantly, it is vitally pertinent to rider safety.