While Kickstart has had a major update, this has nothing to do with the problem you described. What you described is actually something that has to do with how Apache works. It's been something I have come across several times over the past 20 years and have documented since well over a decade ago in https://www.akeeba.com/documentation/akeeba-backup-joomla/restoring-backups.html#general-guidelines:
If you are restoring on a subdomain, make sure that the subdomain's root directory is NOT a subdirectory of your main site. This is the same as the previous paragraph, really. Most hosting control panel software default to using a subdirectory of your site's root when creating a subdomain. For example, if your site is www.example.com and its root is public_html if you create the subdomain dev.example.com your hosting control panel will put its root in public_html/dev. Therefore you will have the problem we described above. In this case ask your host what is the best way to create a root folder for the subdomain next to public_html, not inside it.
If you want to be technical, the whole problem comes from the fact that Apache does two things. First, it's what I described in the paragraph in the documentation I pasted above: Apache will include the contents of .htaccess based on the filesystem tree, not the logical organisation of virtual hosts (subdomains). The second problem is how RewriteRules are handled in this configuration cascading scenario. If you're used to cascading in programming languages and CSS, you probably expect that the more specific file (the one in your subdomain's root) will overwrite the least specific one (the one in your main site's root, i.e. the subdomain root's parent directory). Yeah, no, Apache doesn't do that. The least specific file is the one that overrides the more specific files because cascading works backwards: Apache reads the virtual host configuration, then the .htaccess file from the directory you are accessing, then the file from the directory above it etc. This can, technically, be overridden but only for RewriteRule directives with many caveats and weird conditions, making it absolutely impractical to deal with in an automated tool like Admin Tools' .htaccess Maker. Addressing this situation is unnecessarily complex. It makes a lot more sense simply doing the reasonable thing and having subdomain roots next to each other and next to the main site's root instead of nesting them like Russian dolls.
If you remove the subdomain and then create it afresh you will see that you are given a choice of where to put its root. It's prefilled with a directory of the main site, but you can change it.
Nicholas K. Dionysopoulos
Lead Developer and Director
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