I think it's just a means to prevent you from always getting something good. You could have a system where you have a chance to convert an item to a materia with there also being a chance to fail. Or you have the system we have, where you always 100% convert an item to materia, but with a chance of getting something crappy. With either system it balances it out with some amount of RNG to make certain items rarer than others. Hey, I'm not saying it's a good thing, but that's how I see it.