This is, of course, speculation: I think his grooves collapsed because the whole bullet was pressurized (nose crunching down, base getting kicked, point having static inertia, all this happening at once), so when the lube had an opportunity to depart in the cylinder gap/forcing cone space, it did so and the metal just flowed in. There's no telling how much the bullet swelled up as it departed the cylinder and entered the forcing cone area, but the barrel swaged it back down to a bore/groove cylinder in any case.
As we've remarked, it's odd that a bullet loses its grooves, or even shrinks them, but it's pretty obvious that the bullet is under extreme pressure and instead of just elongating, it's swelling in the middle. My money is on the nose shape and size causing resistance and metal movement, which the pressure on the base works against, the two forces meet in the middle and the bullet swells up.