Scenario:
Your setup an LFM for a raid and start clearing the pre/quest/zone. But you didnt make the group a raid before people started entering. You want to invite other poeple to the group but cannot because people are in an instance.
But its a raid instance! (ok they might be in other instances). You should allow the party to convert to a raid group if people are in raid group and public areas. Dont force us to recall out first.