Una Due Tfc,
I think the confusing thing for these guys was the clearance was given to them (per the report, page 4, third paragraph) as "Flight Level Two Hundred." So written down that does look a whole lot like Twenty Thousand Feet. But, then the crew has read somewhere that FL050 is the lowest TL; they hear "Two Hundred" so to them that must mean "Two Thousand" because that's a whole lot less than "Twenty Thousand" which, to them, would have been spoken as "Flight Level Two Zero Zero." To GlobalNav's point, why they accepted the clearance below the MSA in unfamiliar territory...only they can answer. But there is a lot of trust in controllers, so they must have thought it OK.