Cisco >224.0/3 problems..

I know this is all "multicast" space, but considering classless routing
and CIDR, shouldn't this space be usable and able to be manipulated ?

  Nope. Its still special. Once you turn on multicast support,
  you get to "diddle" in that space although not directly.

  See the nanog archives from late 1996/early 1997 for exaustive
  discussions on what were special use addresses and what became
  special use. Look for "Martian" in the subject thread.