It doesn't make a lot of sense, but if you consider the fact that the NCAA tournament committee wants to keep more teams close to home as long as they can, then you see the point.
Previously, you would have to send half the West region to Seattle, and half the West region to Denver. Not a fair result for a Florida or St. John's, right? So they decided to split the sub-region locations into 4-team pods times 2. Then slap the locations onto the bracket AFTER the teams are in the bracket, instead of before. Now of course it depends on which teams are at the top of the field, but in general you end up with locations on both coasts as the "leftover" spots.
It all works as you go down from 1-16 on the S-curve. Key example of this point is Maryland vs Purdue. We know now that Purdue was ahead of Maryland on the S-curve. But we knew it as soon as the bracket came out when we found out that Purdue was in Providence and Maryland was in Seattle. Along with Purdue in Indy and Maryland in San Francisco.
Another example is how Wisconsin is not in Milwaukee. It's because Kentucky was ahead of them on the S-curve, and when they got to that point, Milwaukee was available. Then it wasn't when it came to Wisconsin, so they went to Denver.