This appears to be fixed in 1.10. Though seeing as I haven't found the change log with this fix mentioned, I'll leave it up temporarily.
From the changelog:
Player position is now accurately saved when exiting and rejoining a world
Description:
When signing out of a game at world height (standing on a block at y= 255, player height = 256), signing back in to the game results in a variety of unpredictable behaviors.
The most frequent possibility is that the player will appear somewhere below the block they signed out on, slightly offset in x or z coordinate value (this is not what is described in https://bugs.mojang.com/browse/MCPE-38374).
The next most common result is respawning in at y = -40 (below bedrock) and instantly dying if in survival.
The least common behavior is actually respawning where you signed off, which would be the expected result.
Steps to Reproduce:
1) Create a new creative world.
2) Place a block at y=255 and stand in the middle of it.
3) Leave the game and come back.
4) Notice the variety of strange results.
5) For more fun, fill a 16x16 area around the player's perch down to y=2 with solid blocks. Move around and retry. Certain positions seemed more likely to result in strange behavior than others.
Severity:
Moderately severe by my estimate. While it's unlikely that most players build to world height, those that do can encounter severe progress loss. It also indicates a slightly unpredictable implementation, which could indicate further issues not yet discovered.
Unlisted Video Example (7:27): https://youtu.be/r8Ups0My1uw
The end of the video contains two below bedrock spawns, and they can occur even with air blocks below the block(s) at 255.
Attachments
Comments 3
@Kyle morley
While it's a reasonable guess that the value for height is stored as an 8-bit int, this is not the case. Looking at the save file shows the data type used is actually a float. And it is capped at 512, not 256. There is a reasonable amount of decimal precision regardless of value. If it were stored as an integer type, it would potentially have issues if a player were to attempt to sign out while standing on a bottom-half slab.
Also, before spawning back in, the value stored in the save file will be correct, but can still result in spawning in at -40. Notice in the video that the player doesn't spawn in at -1 and fall to -40, but they instantly spawn in at -40.
Regardless of cause/implementation, this is a severe bug in the regard that it can result in progress loss. It can occur while doing something well within the bounds of the game. There is literally an achievement for reaching the top of the world while using scaffolding!
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This is caused by the value which stores the height being an 8 bit integer which has a range of 0 (00000000) to 255 (11111111) and when it tries to store 256 (1,00000000) it has nowhere to store the 9th value so it is discarded and saved as 0 (00000000), so 255+1 = 0.
The only fix is to increase the size of the integer to 16 bit (0-65535) which means more storage is used to store the height