Rob, I was able to reproduce your problem (not following proper hierarchy with identical schedules) by playing a DAILY INC against a 1st Sunday FULL at the same time.  I've never used that particular schedule item (1st Sunday of the month) so I've never seen the problem.  I use daily INCs, weekly DIFFs (on Sunday) and monthly FULLs (1st of each month) with no issues, even when the 1st of the month falls on a Sunday.  My schedule entry list has INCs first, DIFFs second and FULLs third.
I'm sure the Devs will look into this scheduling anomaly... (won't you...
 
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I'm sure the Devs will look into this scheduling anomaly... (won't you...
 
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