It's a very important point. I don't think the intention of Parliament in passing that was to set up a second guessing of the original conviction and sentence.
As Mr. Churney is indicating, though, the judge at the time may have accepted a plea bargain--for example, where a number of elderly people were defrauded of their life savings. The judge accepts a plea bargain and imposes the sentence that counsel have recommended. That's the fair and appropriate sentence, but at some later point, when it comes time for a pardon to be considered, it may be that the suffering of those victims is still so severe, so egregious, that notwithstanding the good conduct of the offender in the interim, it may be a compelling case where issuing a pardon would meet the test that Parliament has articulated.
I think Parliament's intention was that it would be a rare situation. As you have said, it's not appropriate to re-judge or re-sentence. It is in those limited circumstances where there is potentially some ongoing suffering or harm that was not contemplated or expected.