For me, it's like clothes: you want to get the right size for you or else it looks untidy :-)
Other reasons, I suppose, would be that underpacking the bag will causes its contents to move around in the bag. Also, as mentioned, it might not qualify as a carry-on for international flights (although I guess what you're saying is that you could smush it up to make it qualify? Still, this seems kind of annoying when you could just have the right sized bag to begin with :-)

