It seems to me that the crux of that argument is the assumption that there is only one direction or axis in which something can be considered more fundamental than something else.
Rationality can be epistemologically basic, in that you need to be rational to arrive at physics, and physics can be ontologically basic in that rational agents are made of matter.
Sometimes the solution is to drop the framing that the two alternatives are actually rivalrous.
I don’t think that’s it. The inference I most disagree with is “rationality must have a simple core”, or “Occam’s razor works on rationality”. I’m sure there’s some meaning of “fundamental” or “epistemologically basic” such that I’d agree that rationality has that property, but that doesn’t entail “rationality has a simple core”.