More clarity needed on airplane liquid ban

On a flight from Melbourne to Singapore, I mistakenly carried a bottle of sunscreen lotion in my carry-on luggage, and was told to dispose of it.

I was also told that alternatively, if I could get the 500ml of sunscreen lotion rebottled into five smaller bottles at a nearby chemist at the airport, I could take it on board with me.

As this would cost me the same price as the bottle of sunscreen lotion itself, I decided to just discard it.

This set me thinking: Why would 500ml of liquid be of concern, yet not the same amount split into five smaller containers?

Couldn't a would-be terrorist mix the five bottles of 100ml liquid together to form a liquid explosive?

Patrick Low