In a collapsing universe, it is better to think of light standing still.
"Even in your collapsing universe model, you haven't explained to me the difference between the space that is expanding/collapsing and the vacuum that light crosses at C."
Since c defines the collapse rate, it is us who are moving at c and light stands still. Since c changes over proper time, the collapse rate changes but the light is just waiting there for us to get to it. In the collapsing universe, the CMBR is very near c, which is the rate of collapse in this epoch.