In my imagination: Don't rotor blades also profit from air getting "in between" them, so that they have something to push against and thus push upwards? The screw relies on air getting in from the sides, while that air is being pushes outwards by the rotating screw.
The authors did test having a "lip" around the edge of the screw:
It was hypothesized that a down facing lip would prevent air from escaping radially outward from the rotor, but this was proven incorrect. All rotors tested (3,4 and 5 in Figure 2.2) have 1 turn, a pitch of 100 mm (3.94 in), a radius of 76 mm (3 in), and a 1:1 taper ratio.
A downward facing lip showed reduced thrust and an upward facing lip showed negligible impact on thrust in Figure 2.7.
Flow visualization conducted during this trial revealed that air was being ingested radially inward during operation of the no lip and up facing lip aerial screws, and that this flow was disrupted by the down facing lip. These results support the findings of the CFD studies detailed in Chapter 3.
Figure 2.8 indicates that the presence of a lip in either direction increased the power requirement of the rotor. Figure 2.9 shows that the presence of a lip in either direction also reduced the FM of the aerial screw. Therefore, a lip is not a useful design feature at all, and was discarded.
Am I totally off here?