How to set breaker points?

...................But it is just as important to know why you cannot just gap the points closer to create more dwell. whey is dwell specified, in other words?

This is in part because as the points are gapped more and more closely, yes, dwell increases, BUT you reach a point (ha ha pun) where they are close enough and on the "low" opening rate of the cam that they begin to spark. Also if they are too close, ANY problem with the distributor might become a problem. Shaft wear, shaft eccentricity, etc may result in misfires because the points won't open reliably. "Slop" in the movement of the advance plate as the vacuum advance activates, etc.

So the dwell was specified for optimum against those things, as well as long term longivity as the points rubbing block wore, etc