The reasons are pretty much a combination of the practical and the theological. On the practical side there’s the issue of knowing how much bread will be needed for any particular celebration. Small hosts permit the ability quickly estimate how much is needed and how much is being used. Then there is the issue of reservation. Mold is not something you would want spreading through communion. Hosts can be safely stored for a decent period of time.
On the theological end, we believe that as long as there is the appearance of bread the Real Presence is present. If regular bread is used, crumbs would be everywhere. Each visible crumb would be the body, blood, soul, and divinity of Jesus. It would be disrespectful of the Real Presence to permit such an obvious danger of sacrilege. Hosts are pretty compact and, unless broken, don’t generally flake crumbs during distribution.
It should be noted that use of leavened or unleavened bread is irrelevant when it comes to the validity of the sacrament and both have venerable Church traditions. Churches that use leavened bread bake and (usually) pre-cut it in such a way as to minimize the issues presented above. The Latin Church has traditionally used unleavened bread since the tradition is that the Last Supper was a seder meal (which uses unleavened bread).
