The "gap" is required to eliminate (attempt to reduce) one source of stress in the SW joint after welding.
Logic is: The weld is applied with very hot metal that will cool (shrink) after welding.
If the pipe is bottomed out firmly in the bottom of the SW "cup" BEFORE welding, then, after the weld solidifies and begins cooling, it will shrink and try to pull the pipe further into the cup.
So, to allow for the very small length of shrinkage as the metal cools from about 1300 degrees (when it begins to become plastic from its original melted) to ambient (60 degrees), a small margin is required below the end of the pipe.
ANY margin after shrinkage that is left in the SW joint - ANY at all - is sufficient to verify that no stress is created.
If, after shrinkage (after welding) there is no verifiable gap, you cannot know how large the gap was before welding, nor can you verify how much - OR HOW LITTLE - of the original shrinkage gap was taken up before compression in the pipe metal began and stress began to rise. There might very, very little compression stress at all. That uncertainty of the residual stress is why a larger-than-needed gap (up to 1/8 to 1/16 inch) is used BEFORE welding begins, so you have a verifiable margin after welding ends.