Can anyone explain why XX:G1HeapRegionSize must be power of 2 ?
Simply because that is how Oracle has implemented the G1 collector.
When implementing something like a garbage collector, you need to make design choices in order for it to work. There are probably a number of detailed reasons why the G1 designers made these particular choices. The general themes will be to optimize performance in critical G1 code paths (e.g. the write barriers) and/or to avoid unnecessary complexity in the G1 code base as a whole.
(For example, if the size of a region is a power of two, and if each one starts on an address that is divisible by the region size, then you can use masking to efficiently compute which region an address belongs in. If you can save some instructions in the write barrier code, that could mean a couple of percentage points of performance for the entire JVM. I won't go into more detail ... but you can look up the literature.)
But the reasons are moot. You either live with the G1 restriction, or you select a different garbage collector that is better for your use-case.
Is there any problem in setting 10m heap region for -Xmx12g ?
Well ... it won't work ... because of the restriction that you have already found.
