I think Gen 2 magic detection is quite uncommon, in some high security applications you might see it but usually they know better than to use a defeated card system.
One possibility is that it’s checking the card ‘version’ and seeing that it is 1k not 4k, but since the data is correct continuing anyway.
Perhaps the more likely possibility is that the breathing light is unrelated. Perhaps the reader tries to connect to a server to update balances there too, and if it can’t connect it does the transaction on the card directly and breathes until it can reconnect to server?
It seems weird they’d go to the trouble of detecting clones and fakes, then have it just continue without issue anyway.