You know, I don't really think Knukles as leader was THAT bad idea. Obviously not perfect, but I can see some logic behind it. I mean, how many times you see main hero (like IDK, Sonic) getting to be the leader, despite how little experience he has.
Obviously best choices (Sonic, Tails, Shadow, Blaze, Sally Acorn) were for different reasons unavailable. But why pick Knuckles over Amy, Vector or Rouge?
Really for same reasons in Steven Universe, it's Garnet who's in charge even if Pearl is smarter. There are many qualities other that brains, like being able to take the pressure. Vector is good person, but I don't think he's capable of holding world on his shoulders. (Amy is arguable on this front, but I could imagine death of Sonic would affect her more than Knux). And Rouge isn't a leader for same reason Black Widow never rarely leads Avengers. Or why Superman leads Justice League, not Batman. Let's say they don't have people skills. (Also, Rouge was needed in field. Spying was much more important than extra fists).
I wouldn't go as far as calling Knuckles figurehead, but I imagine his stubborn tenacity was fundamentals for Resistance. Boosting morals, teaching rookies, leading bigger battle, making quick decisions in heated moments. But all major tactical moves were decided by group (like Amy stopping Knuckles from going on field before one of last missions). At least that's what I would like it to be, as Sega won't give a damn and Flynn just gave up.