In short, if Knuckles is the Guardian of the Master Emerald, and the Master Emerald exists to neutralize the power of the Chaos Emeralds, then Knuckles' duty should be to watch over the Chaos Emeralds and ensure they do not cause... well... "chaos". And since Sonic is the embodiment of the Chaos Emeralds' power, then Knuckles has to be Sonic's "Master" as well. Naturally, Sonic won't like that, and thus their sparks their rivalry.