What magic stops the blue line from reaching the eye:
Why would the blue line reach the eye?
Because it is light, travelling through the air, with no obstruction to stop it. Without the tube there, it gets there just fine, and the tube clearly doesn't obstruct the path.
If there was no tube, do you think the blue line would get there?
Do I need to rephrase it?
Why can the green line reach the eye, but not the blue one?
And don't forget the other one:
You start looking straight down towards a round Earth and slowly lift your head up until you are looking straight up at the sky.
What do you see between the land/sea of Earth and the sky?
How does it visually transition?
No, you will see a compressed building, by sight that fits into that 2 inch of diameter.
Again, does the building magically compress to be only 2 inches tall?
If not, you need to have light come from above and/or below the tube just like that blue line.
Nothing would stop you seeing the blue line with a fish eye, human eye, wide view, lens.
You have a great field of view. But I'm not talking about that so why are you people using it?
Because it clearly establishes that the blue line is capable of reaching the eye.
Just like the orange line is also capable of reaching the eye when no tube is used.
So the issue is what does the tube do?
It is clear that it blocks the orange line, because that would otherwise intersect the tube.
i.e. in order for the orange line to reach your eye, with the tube there, it needs to go through the wall of the tube.
But that isn't the case for the blue line, so what stops the blue line?