What's the deal with Knox knowing the admitted killer? Something about she met him that night?
She didn't meet him that night.
It appears she had probably run into him, briefly, one or two times and these were days or weeks before the murder. He was a character who floated around in the student community there and who had sort of inserted himself into the group of guys who lived in the same building that Knox and her female roommates did. The males had the first floor, the girls had the upstairs.
So Rudy Guede, the rapist/murderer/burglar was someone who was around. He seems to have been a drug dealer and petty criminal who had recently been graduating into more serious stuff, broke into a nursery school and was caught there with a large knife, which he told police he kept to "protect" himself in case anyone else broke in
Amanda running into him a time or two has zero significance, and any "witness" who says she was with him that night is much better explained by something which happened a LOT in this case:
Whenever there's a frenzy attitude of sensationalism like this surrounding a case, there's always a danger of people coming out of the woodwork trying to insert themselves into it. People are drawn to fame and attention and anything high profile. Some sorts of personalities are desperate to get involved in some way, to be part of the big deal.
This is well known by police and good cops know how to recognize and weed these people out, usually.
However, the Italian police in this small town were so desperate to "solve" this murder and to do so quickly, and so desperate for anything to help them solidify their case against Knox and Sollecito, that they were listening to the kind of people who good police would tell to fuck off.
There was a crazy homeless guy who changed his story several times and most of them were completely ridiculous, there was a lady in an apartment who claimed to hear something she couldn't have heard... there was I believe a shopkeeper who claimed to hear something which wasn't said about underwear... etc. These people are bad enough in the best of situations but when the police, prosecutors, and the system itself is being crazy and sensationalist and talking bullshit about Satanic sex rituals, it just encourages these people even more. It encourages them to come out of the woodwork more, and for their stories to be crazier when they do.
There is no credible eye witness who puts Knox or Sollecito anywhere in the sphere of this crime.
Guede was a poor, immoral piece of shit who knew it was about to be the day rent was due for a lot of these students in the town. He broke into a house he was already familiar with, and where he probably knew the guys were out of town, and after he found some of the rent money he decided to use the toilet. While he was sitting on it, it seems Meredith likely came home.
He likely didn't flush due to realizing the sound would alert her to his presence. He probably could have gotten the hell out of there with the money, but either he realized there was one solitary, attractive female in a house where he'd already broken the law and decided to make a move on her, or she discovered him as he tried to leave and he knew she could ID him so he did what he did.
I don't think he went there planning to murder or rape anyone. I think he wanted to get in and out without anyone being there. I think a combination of panic, lust, already being in deep shit, and poorly reacting to her fear and unwillingness to comply with his sexual demands, are what culminated in him graduating to murderer that night.