Bee's knees aren't all that cute. The fact that bee's knees stand for the epitome of something might relate to the pollen sacks on bee's legs, which result the pollination of the flowers we enjoy and the crops we eat.
That plus the fact that it rhymes. We seem to have a weakness for such terms in English. (Probably they do it in other languages, too.) "Aces and spaces", "stars and bars", "Slim Jim", "double trouble": we have hundreds of favorite phrases like them. Is there a word for it?
"The bee's knees" is a common reverent to old people's talk, but i think its rehabilitation is owed to the writers for The Simpsons, who often put it in Grandpa Simpson's mouth.
It was young folks' slang, in the Roaring 20s I believe; it meant something pretty darned cool.
I'm not certain that I found it convincing that the expression was derived from the perfection of actual bees' knees – I always thought it was just an affected/ comedic pronunciation of “the businessâ€: to say that something is “the business†expresses exactly the same sentiment. My guess is that the perfection of bees' knee joint derivation is a back-formation from the more straightforward “the businessâ€â€¦