When you look into the eyepiece, you've noticed that the image is round, framed by a black ring. That ring is called the field stop, and it's an actual round piece of metal or plastic inside the eyepiece. Its function is to limit the image to the size where the image quality in that eyepiece is acceptable.
If you were to remove the field stop, the image outside of it would start to look bad, and its edges would be fuzzy and barely usable. Also, most people prefer a neat, sharp edge to the field of view, so there's the esthetic element to consider also.
The size of the field stop is given by two parameters:
- the focal length of the eyepiece
- the apparent field of view of the eyepiece, or how wide the image appears when you look in the eyepiece
Longer focal length eyepieces will naturally have bigger field stops, keeping everything else in proportion. Eyepieces with a wider field of view will also require a bigger field stop.
Now, the field stop, obviously, must be smaller than the diameter of the barrel of the eyepiece, otherwise it would not fit in.
So, when you stick to short focal length eyepieces with a narrow field of view, the required field stop is pretty small, and it can easily fit into a 1.25" barrel.
But with longer focal length eyepieces, especially with modern eyepieces with a wide field of view, the field stop can grow pretty large, and eventually becomes bigger than the 1.25" barrel. That's when you need to move up to a 2" barrel. That's what drives the need for larger size barrels.
Long time ago, there used to be eyepieces with 0.965" barrel diameter, because back then opticians didn't know how to make wide field eyepieces. Then the field of view kept increasing, so opticians moved up to 1.25".
Eventually the newer 2" standard was adopted, as the field of view kept growing. At 32mm focal length, a Plossl eyepiece with a 52 degree field of view can fit in a 1.25" barrel, but a more recent 68 degree design requires 2".
Nowadays there's a new standard emerging, with a 3" barrel diameter, imposed by the very wide field eyepiece designs invented recently. At 30mm focal length, an eyepiece with an 82 degree field of view could use a 2" barrel, but if you demand 100 degrees FoV at 30mm, you need to move up to 3".
Of course, larger barrel diameters make heavier and more expensive eyepieces. So you need to mix and match. At smaller focal lengths, the 1.25" barrel works well. For longer focal length eyepieces, as you move up in terms of the size of the field of view, eventually you must switch to 2".
If you only use Plossl eyepieces, you can have all of them in the 1.25" format, because even at the longest focal lengths that make sense in practice, the Plossl field of view is narrow enough to not require a big field stop.
MyAs a practical example, my collection of eyepieces currently is about evenly split between 1.25" and 2", with the 2" barrels being reserved for eyepieces over 18mm focal length. All my eyepieces have an 82 degree field of view.