Smaller size (fuel volume) is the primary driver for area of effect.

The other is design basis. (Double end guillotine shear of the cold leg, loss of core cooling). If the core loses all ability to keep the fuel “cool” then you have maximum damage and potential for inadvertent leakage of fission products to atmosphere. The potential spread of contamination and radiation increases greatly, and that is design basis. How well can the structure contain that level of damage and mitigate radioactive release. Less fuel, less potential, but less power.