The awarding of tournaments isn't just about the quality of the teams - it's about investing in the infrastructure of the game.
Poland and Ukraine have both had to upgrade their stadiums and transport networks in order to host the tournament.
One of the reasons we suffer in hosting bids is that all this stuff is already in place.
The Pot 1 thing is to ensure that the host countries play their games at home and also give them a theoretically better chance of getting to the next round which is supposed to improve the tournament atmosphere.
Poland managed to upgrade stadiums and infrastructure. Ukraine? Not so much...