I was playing in a tourney last week, and I used a V Wonder Woman to hit E Green Lantern and rolled a 12, this knocked him off the top of a building, but my opponent and judge said characters with flying and Leap/Climb don't take knockback damage from terrain. Is this true? I didn't argue because I didn't know for sure, but would like to know the rule, and where it can be found.

The rule for that one is under the Knockback section, 5th paragraph, in the Indy rulebook. It states that the hovering characters only takes damage when crossing blocking terrain or a map edge.

The hovering character (green lantern) in your case would not have taken damage, just the extra one for rolling 12, nice roll

I haven't seen or heard anything about leap/climb ignoring the effects of knockback off an elevated terrain. I believe they would take damage as normal.

Joey is correct. Flyers do not take damage from falling from elevated terrain. L/Cers take falling damage as normal.