If you're referring to the Stanislav Petrov incident — it wasn't passed up the command line. That was his specific intervention, not passing it up higher.

As to why it might not have been used if it had been passed up (i.e. why nuclear war was dangerous) — in the early 1980s the Soviets were extremely afraid of a decapitating first strike attack from the USA. The US had short and medium range nuclear missiles within range of Moscow that would give almost no warning time once detected (minutes at most). If the USSR was to respond to such a thing they would have to do so immediately. If they did not, they ran the risk of not being able to respond at all (the idea is that the US would take out the political centers and infrastructure and then immediately target remaining Soviet nuclear forces before they could get organized to "reply").

So no hotline would be any use there. Separately, the hotline was not secured in any way against nuclear attack — it used standard civilian infrastructure. So it would not withstand a first strike.

The hotline was never meant to be used in this way, as a way for the Soviets (or USA) to say, "hey, is that incoming missile legit?" It was meant to help diffuse situations before they got that far.

In any case, look at it from the Soviet point of view. If it was a legitimate, decapitating first strike, would the US admit it on the hotline? What good could it have done to have called? There is no response the US could give that would be satisfactory on the face of it, given the need for an immediate response if it was legitimate. And the Soviets were not inclined to give the US the benefit of the doubt — again, they had been worried for years about this kind of attack. (See, e.g. Operation RYAN.)

On the 1983 jitters and the Soviet mindset, David Hoffman's The Dead Hand is great.