How to create multiple option field for product display?
How the products have no influence on how they are rendered on a product reference field.

What matters is what data the products hold, you need to be able to create unique combinations for all, and setup the reference field to try to do this. The problem you might be facing is that some products are too similar. To reviewing the product data and the products reference in the product reference field.

It's likely that you have created near identical products forcing the user to pick from a list containing all products, instead of have multiple select boxes.