The surge that builds up with large storms heading in the same general direction, tends not to dissipate very quickly. The drop to Cat 4 may have stopped building that surge, but it most certainly did nothing to diminish what had already formed in the prior 36 hours.

You'll probably get a more lengthy exposition from the mets, but that's the short of it

As for what was expected, I can't speak eloquently about what other people think, but I'm pretty sure the mets never backed down from 20+ foot estimates of surge.