Kathy,
The short answer is that historically, cremation and scattering of ashes has historically been associated with denial of the Resurrection and certain other problematic philosophical schools of thought (“pantheistic, naturalistic, or nihilistic”), whereas distribution of relics has an Apostolic pedigree, and the problematic concerns are not present. It's not scattering of ashes that is intrinsically wrong, but the fact that those who spread ashes tend to do so for the wrong reasons.
Let's not forget that only relatively recently did the Church allow cremation at all. (The Orthodox Church still prohibits it.) Allowing cremation but denying the scattering of ashes was seen as a compromise.
You may be surprised to learn that recently it's been even more liberalized, although it appears to be a divisive topic among some people.
Read:
Eric
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