Generally, when we put a saddle clamp on we put it so the rails are mounted on the "top" side (reference clamp pictured):
However in my case I still need to lower a seat by a inch more. Looking at the clamp I could do this:
I'm asking this for my kids 16" bike. She fits the bike well, but has a little issue of getting up on the saddle. There appears to be enough space in the saddle to flip the clamp. She is on the petite side at 15kg (and for reference, same model bike, my son was 23kg when he retired it). I do plan on flipping it back over before I extend the seat post though.
Does this work or will I run into issues?
I went ahead and did it, it was just right amount she needed, didn't even mess with the lock on the rack.
Not to take away on the answers here. My daughter has been riding this bike like this for just under a year now. She has even taken it off a simple 2x4 and plywood ramp without issue. I'm sure it will handle most kids, but since she is on the small side then I can't really answer as such.