I agree with everyone who has posted, plus Atkins pulls you OUT of ketosis in premaintenance. He is assuming that your goal weight is a healthy weight and that you no longer need to burn fat. You are leaving ketosis as you have burned off most of your extra fat and before muscle starts to get burned off-at least that is the way I understand it. Of course, you would have problems if you a) choose too low a body weight goal (or bf% goal) and b) don't go through all the stages of Atkins.

I downloaded a body fat percentage spreadsheet program that uses several measurements to calculate bf% and lean muscle %. I have noticed that both my bf has gone down and my lean muscle has gone up. Doesn't look to me that I have lost muscle-looks like I have gained muscle.