> I understand the upcast (which is certainly legal but it forces the casting code to know the depth of the inheritance hierarchy - as in &derived->base1.base2)

If this is inconvenient, just casting directly to Base pointer is also legal.

> but what's the argument making the downcast back to Derived legal C?

The justification comes from this part of the C standard (C99 6.7.2.1 p13):

    Within a structure object, the non-bit-field
    members and the units in which bit-fields reside
    have addresses that increase in the order in which
    they are declared. A pointer to a structure
    object, suitably converted, points to its initial
    member (or if that member is a bit-field, then to
    the unit in which it resides), and vice versa.
    There may be unnamed padding within a structure
    object, but not at its beginning.

It follows that:

    Derived *d = GetDerived();

    // This is legal: a pointer to Derived, suitably converted,
    // points to its initial member "base":
    Base *base = (Base*)d;

    // This is also legal: a pointer to Derived.base, the initial
    // member of Derived, suitably converted, points to Derived.
    Derived *d2 = (Derived*)base;