The weight of the car "bears" on the shoulder/cup at the upper end of the king-pin through the axial thrust bearing. This "closes" any gap at the top and prevent entry of road dirt here.
There actually can form a small "gap" above the axle beam. It sort of exists in the "shadow" of the upper spindle shelf. But the positioning of the king-pin "locking pin" is such that a larger gap is formed BELOW the axle beam. No shelter here AND the lower spindle shelf acts to "catch" water/dirt.
A cupped (shouldered?) washer to restrain and center the felt washer go below the beam - felt on top - and together these sort of fill the gap.
Les Andrews explains that modern upper thrust bearings are slightly thinner than the original bearings. Hence, an extra large diameter washer or two is provided in the kits to go UNDER the thrust bearing and "reposition" the two gaps.
So you want to re-assemble with the mechanics/weaknesses in mind.
Joe K