Hi Adam,
£2.35 is the discounted fare. Without the railcard it is £3.60. Sadly this is a known disadvantage for railcard holders travelling to boundary zone 1/2 stations in the evening peak. Changing the programming to allow some users to be charged to the extra zone would potentially increase the calculation time allowed to process the touch while the card is still touching the reader.
The purpose of offering off-peak fares ending in zone 1 in the evening peak is to encourage people travelling into London for evening entertainment to use public transport.