Yes, it gets converted it to a case structure, but that's probably LabVIEW saying "well, I don't have this structure available, and the case structure is the closest thing, so I'll use that".
What does a case structure and a sequence frame have in common? I have no idea, and I never understood why the ability to switch between these two was made available. altenbach gives one possible scenario, but that's not even available. Frankly, if given the choice between switching from a case structure to a sequence frame as opposed to an event structure, clearly the event structure is the better choice.
Your original question was why there's no automatic way of converting from a case structure to an event structure, and I provided a reasonable argument as to why there isn't. Instead of taking it out on me, based on your response's wording and bolded text, and message rating given (I am assuming it was your rating - if not I apologize) please take it out on the LabVIEW developers.