The general cited reason by maxis is that the simulation is much deeper, which is true. People compare city sizes to simcity 4 but don't really realise that things like roads in sc4 were not much more than animated .gifs. In SC2013 they have this idea of everything being an 'agent'. So, Maxis say that bigger cities wouldn't be as easy to simulate.
So, it's basically a scale problem.
Considering that the "agent" stuff was completely broken well beyond launch even at the small city size, I really would love to know how small the cities actually have to be in order to make that work. I assume at some point they had a prototype where it totally worked great. I'm guess it was like two city blocks.