There is a simple solution to this mechanic. When Malgus has about 10% health left have the tank walk down the steps the middle of the catwalk walkways near the ledges. Then, you kill Malgus with all your dps and healers situated behind Malgus. And then when Malgus starts his phase, you have 1 person with a knockback stand beside Malgus and use it.
It only takes 1 knockback to kill Malgus if he's standing near a ledge to begin with. Its really not a big deal. You just have to adapt your tactics to match the resources you have available to you, and not the resources you wish you had available to you.
Couldn't be more wrong.