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I am having the exact same issue but not sure exactly how you fixed it.

When retracted the BLT is above the nozzle. When its down it is lower than the nozzle. Retracted, the very bottom point BLT is 2mm above the very bottom of the nozzle. If i lowered the BLT any more i think it would catch on the print itself of hit the bed (retracted) before the nozzle hits the bed. So I think my BLT is in the right position. But its shown on my youtube video

my youtube video is here..
https://www.youtube.com/watch?v=n6ogNUV6haU

I am still having this issue. please help

Anycubic i3 Mega (not S)
Trigorilla 1 (not 1.1)
5x TMC2208 and reversed cables
Everything else is stock
BLTouch 3.1 original from Ant.