Yes, the bench add-one have certain space requirements. It is a minor annoyance.

However, I am generally good with how forgiving the clipping is. You want to put your smelter in your base? No problem. Build the base, knock out the lower walls and floor planks in the corner, then drop the smelter halfway into the room. Now you can replace the wall and floor blocks by clipping them into the smelter. This can be done with a lot of items. Some games you cannot do this at all.