Punching up/down isn’t in reference to some scale of a person’s value, but in reference to how much somebody struggles. While in this case is is about race it doesn’t have to be. Making fun of somebody for having cancer for instance would be punching down because they are already struggling with that thing.

Obviously it can get nuanced pretty easily. People like Caitlyn Jenner are so privileged that the systemic oppression/hate of trans people probably don’t effect her very much, so it’s probably not punching down to make fun of her, though others may disagree.

It may make more sense to rephrase it as “don’t hit someone when they’re already on the ground”.