The 21 foot rule is about not closing the distance to someone a LEO is approaching. It is not a justification for shooting someone with a knife.
They may or may not have followed the rule, but it seems likely. For another person to come between them and the guy with the knife, they would have had to have decent separation.
At the point where it becomes apparent that you have someone with a knife, and there is decent separation, the 21 foot rule is no longer relevant, as there is no longer any surprise involved. As soon as they knew the guy had a knife they should, and apparently did draw their weapons. What we can't know, unless there is a recording, is how much time elapsed between "put down the knife" yelled by probably multiple people shouting over each other and the first shot.
I didn't see if there were any claims that knife man Francisco Carvajal, made a move towards them, the story seemed to me more about justifying the killing of person they did not intend to shoot. It did not say what happened to Carvajal, so I assume that he is still living. For them to kill someone other than who they intended to shoot and some how non lethally resolve the situation with the the guy holding the knife is a paradox. My initial read also missed that the police force first tried to claim that Laureano had died from stabbing wounds, which was a total fabrication.
The bullet that hit the hit the other guy was certainly not stray and demonstrates that the officer that fired it was not as aware of their surroundings as they should have been. The officers shooting became so tunnel visioned on the man with the knife that they lost control of the scene.