To be fully compatible with their creative optimisation algorithms, Facebook recommend that you should only add more than one ad to an adset when you want to test creative variations. Creative variations might be different images, messages and or headline text.
When testing creative this should always be done at the ad level and not the adset level as adsets should only be used to target different audiences segments not to test creative.
You could also place several product ads in an adset if you are unsure which product might perform best, for example when you launch a new season line.
The Facebook algorithm will quickly test all ads in an adset against your objective, identify the top performer(s) and spend all the remaining budget for the adset on the top performing ad(s).
You should never place multiple ads or products in a single adset if you want even spend and distribution for each. Also note that placing multiple creative ads within an adset will in no way effect your reach or distribution for the adset, other than to possibly extend it by ensuring that you are putting the most effective creative in front of the adset audience.