I don't know exactly why the physics engine goes crazy sometimes, but I do know that this guy here does it on command. Just run it yourself and you'll see what I mean. It's super consistent and repeatable.
The creature's muscles expand without any upper bound, and the inner and outer squares fly off in different directions.
On the one hand it's clear that part of the problem is that the two skeletal structures are completely separate, but on the other hand it's also reasonable to expect that muscles get worse at expanding when large and worse at contracting when small; this is clearly not true. In any case, the outcome is super buggy.