When mesh reduction results in a section becoming empty, the material slots are incorrectly assigned. e.g. if section 0 gets removed due to it having no triangles after reduction, then its material can get erroneously assigned to section 1 (the "new" first section).
In 5.0, we had a similar issue with Nanite, which was solved by permitting sections with zero triangles, and fixing up all the places in the rendering code which used to enforce that a section had a non-zero triangle count. It may be that this already works in 5.0, or a small tweak is all that's required in the mesh build process to allow zero-sized sections.