Porque no Oracle um varchar de comprimento ZERO é tratado como NULL.
No seu exemplo
NVL(NAME, ' ') AS NAME1 will evaluate to either NAME or ' ' - empty string.
NVL(NAME, '') as NAME2 will evaluate to either NAME or a zero length string
NVL(NAME, ' ') AS NAME1 will evaluate to either NAME or ' ' - empty string.
NVL(NAME, '') as NAME2 will evaluate to either NAME or a zero length string
