Javeryh, actually the manufacturer (porter cable and delta) recommends that the bit be bottomed and then raised 1/16 inch before tightening. This is because as your tightening the bit, it moves down and squeezes, but if the bit is already on the bottom, I may stop before there is a good squeeze. Make sense? Also, I've heard that heat can transfer from the bit to the motor if bottomed out. But you are right, the placement of the bit should never be used to adjust bit height.