The residential setup between Fedex and UPS is one of the few differences between companies, in this case favors UPS.
If a customer puts residential on a package with UPS and the driver scans in commercial on delviery the customer isn't charge the residential fee as marked on the label.
Fedex if you mark a package residential and it is commercial on delivery, it will stay residential, ground or express, it does seem fishy but not so fast. I get this issue to a point with the ground side, when making a residential ground that comes out Home Delivery, it's a different group handling those, so people are going to places they shouldn't be, the customer making the mistake is causing non-optimal routing for Fedex. I get that, even though that is an advantage for UPS still as they can have the fee taken off by delivery scan.
Express though it's all the same network and if the label comes out residential, the residential fee is applied no matter if it is delivered to City Hall. I believe that is what this is about. It is in your Service Manual stating what Fedex will do, to me it could be looked at their policy and terms, so in some case I can see this as nothing illegal but the company policy on how they process labels, deliver them and then charge them as stated. Fedex Sales doesn't hide this from my engagement. It's the policy... they share it as it is published, customer can decide to take it or leave it.