I don't know that it offends anybody if you wear your kilt a little bit long, but the traditional way to wear a kilt is with the selvedge hitting right above the kneecap or mid-cap, at the lowest. From what I've read, the tradition comes from the kilt wearer not wanting the pleats of his kilt to cut across the back of his knee, especially if the pleats are a little bit wet from the rain that Scotland has.