Well there are a couple reasons the Sith do the "Rule of Two." One is simply keeping the tradition started by Darth Bane. However, HE and the rest, thought the rule was a good idea because
- it consolidates power to 2 people held above the rest, even if they are dark force users (considered dark Jedi instead of Sith lords)
- it is actually harder for a smaller force to be FOUND if not engaged. They can hide much better BECAUSE they are only two.
It would be much more difficult to hide an entire dark side order and/or evil government and so forth. The Sith deal in deception and shadow, and would not honestly reveal who they are, what their intentions, are, or risk losing in open battle. They are not the good guys and the rest of society with a different color, they have completely different philosophies on organization and gaining power. The Sith seek to take it from the Jedi, who they view are unjustly in power. To the Sith, they are the minority taking the false system down from the inside, and when they are on top, since there are only two of them, they are like gods and don't have to share with an entire order of others.
They not only want to take the Jedi out of the way, but I think most importantly, the rule of two ensures that power won't stagnate: if the apprentice becomes more powerful than the master, there is no use for the master anymore, so each generation of Sith lords in theory would be more powerful than the last. To Sith, everything is about individual strength.
