To appear on the European front page the treasury has to contain at least 8 shops that are located in Europe, and every item has to ship to at least one country in Europe. I think the UK, France and Germany also have their own front pages, but I could be wrong.
As long as shops have international shipping then there is nothing stopping European shops appearing on the main front page and US shops appearing on the local front pages.
I think Etsy does this so that people who have just discovered the site aren't seeing items that can't be shipped to their country on the very first page - could be a turn off or make them assume it's only a US/European/Australian/whatever site and then they don't look any further.
I'm based in the UK and so far I've had two of my treasuries picked for the main(US) front page and one treasury for the UK front page, so I don't think location is limiting exposure at all.
Now if I can just get one of my ITEMS on ANY front page I will be very happy ;)