I am exploring the “first person example map”.
I have noticed that when the floor is there I can walk off the end of it and fall into the abyss. So I would expect that once I remove all the geo that makes up the arena including the floor my character would fall straight down into the abyss, but it doesn’t !? There seems to be an invisible floor there. Can anyone tell me why he doesnt fall down?
If you only simulate the Level the Player will stuck into position. If you possess the Player it should be destroyed at a certain height. Depends on the Value of “KillZ”. I hope that was what you meant. 
Have you tried rebuilding the level geometry before playing again?
Sometimes you’ll need to rebuild and save for the level changes to take effect.