OK, This may have been a bug. I reset again, twice actually and I can spend my points normally. [/edit]
Made it to level 60. Have reset points twice now. I have run out: spent 496 of 497. So knowledge points are same as original. However, I can’t afford to learn level 60 weapons and armors, e.g. I can learn Hiltmaker if I reset and choose no weapons. Then I won’t have enough for any weapon. I can’t even afford the Vault feat for the crates.
I haven’t unlocked any of the Tinker feats or epic armors. I haven’t unlocked any religious upgrades. I did unlock most Journeyman and Master Builder feats. In the original game I unlocked Hiltmaker, Shield Framer, Ropemaker and Shaftmaker and more (including Master Tinker).
For now the only thing I can think of doing is not unlocking Journeyman and Master Mason. I can save 34 points there. I could also skip Master Tanner and maybe Master Carpenter for 12 each. But I had all of these and more in the original game. So I’m confused, I can’t determine where the missing (?) knowledge points went.