Here's one of Kyle's pictures from the Aboyne Highland games showing a range of kilt selvage heights. On the left there does not appear to be enough (any?) knee showing, while on the middle and right we have the more acceptable range from mid to top of the knee.
Interesting side note: check out the age of the individuals and compare them to the height of the kilt. It might explain that those who have been wearing it longer, and who are more rooted in tradition, are showing more knee.