The problem is that the 2:1 ratio just doesn't hold true. Alton Brown hinted at this in Power to the Pilaf:
Now, the second secret to happy rice is finding the right ratio of rice to liquid. The instructions on your average bag of rice always says the same thing, "1 cup rice, 2 cups water." If that were right, and I don't think it is, one could deduce that a 2 to 1 water/rice ratio would always be the way to go no matter how much rice was involved. Well, it isn't that way. Not only are 2 cups of water more than any respectable cup of long grain rice needs, but the proportion of water to rice actually goes down the more rice you cook. Here's how we see it.
Now, for the sake of argument we will restrict our demonstration to American long grain white rice. One cup of rice will cook very nicely, thank you, in 1 1/2 cups of water. It seems pretty simple, right? But, the plot thickens.
Two cups of rice will cook perfectly in 2 3/4 cups of water. Wait, it gets even weirder.
Three cups of rice can be cooked to perfection in 3 1/2 cups of water.
Which obviously makes it seem apparent that the more rice you cook the less water you need. Now, if you have a slide rule and you know how to use it you could probably figure out some handy formula or at the very least come up with a good comedy routine. "Hey, Abbot. When are we going to have more rice than watuh?"
America's Test Kitchen did some further study, and figured out what the problem is -- you need 1 cup of water per cup of rice (for the varieties they used), plus the amount that's lost through evaporation.
I suspect that the reason that the 'up to the (first|second) knuckle' trick works is that those people are most likely cooking in the same pan, with the same lid (and so the amount of water lost through evaporation is more constant), and cooking nearly the same amount of rice each time. Of course, a constant head space would actually mean less water for evaporation each time (as not all of it will fit between the grains of the rice), so there must be some range of acceptable water to rice, rather than it being a rigid fixed number.