That's a very good question, especially from an S&G guy who sees an inside chine as a big fat fillet of thickened epoxy. Properly cut, an inside chine log is a parallelagram. The top of the log is parallel to the floor so water doesn't lay against the hull. If it was cut as a square or rectangle you would have the problem that you are envisioning. Those old frame builders knew what they were doing and it still works today.
Hi Jordan -- The day that I managed to get my chine logs installed was so great -- suddenly I could see that maybe this whole thing is gonna really happen -- And the beauty and wisdom of the lines is revealed. Starts looking like a boat - be damnded. VIOLA.
Looks to me like you are doing a great job - nice looking wood you are using - all vertical grain - Thanks for the pictures. What a kick is the experience of building and creating hey!