"why ese and not eso?"
"Ese" is "that" in the third person masculine, like "libro". Think "ese hombre". "Eso" is gender neutral and used for abstract concepts. The confusion is the -o ending of "eso", I suppose. In this case, the -o ending does not signify a male ending. In the same way, "este" refers to "this" thing with a masculine ending, and "esto" refers to an abstract concept. There are some exceptions you will just have to learn.
I don't really know. But I can guess.
Confusing "este/esta" with "ese/esa" is very common among people just starting out. The more practice the better.
In addition, fairly often Spanish uses "this" when English speakers would choose "that" and vice versa. Exposing us to these differences in usage helps us sort them out.