I honestly feel like they're put there in place of a chance to fail a conversion. Since you can't fail converting gear, there has to be a chance to get nothing (or garbage, which is the resistance materia) so that you don't get good stuff every time you convert. So, instead of 50% chance to get something good and 50% chance your item blows up, you have a 50% chance of getting something good and a 50% chance of getting crap materia. I just made those numbers up, obviously, but you get the point. Grind is grind.