There's two possible and opposite ways to complete the popular expression "it makes too much sense" and thus give meaning to it:
Which one is it?
I usually think of this as meaning "It must be false", in an extremely sarcastic way. For example, if a political policy that seems sensible gets enacted into law, someone with a low opinion of their officials might say "There's no way our government made that policy. It makes too much sense."
Some people might say "It makes too much sense, it must be true", but I don't really think of that as an idiom; it means just what it says.
It's irony or sarcasm. It takes the idea that the world/public/etc doesn't do things that are logical/right/good.
So, a logical decision based on facts is met with this sarcastic phrase.
"That makes too much sense..."
Whenever 'too' is used in the sense of 'too much', it normally means 'too good to be true'.
So, when you say, 'this makes too much sense', I assume you mean, 'it must be false'.
too much means more than required. You don't need that much of the thing.
too much - more than necessary.
So,
Do you call this whole-milk tea? It's too much of water in this, (and) there must be little milk.
Now, it makes it clearer.
It makes too much sense to be true, it must be false - It gives sense that this as the truth is more than necessary, I smell a rat here...I doubt, it's false.
And vice versa...
I actually have another variation on this — when it is followed by the phrase: NOT to (do it, say it, enact, etc.) For example:
"It made too much sense NOT to do."
So this follows an initial leaning or presumption NOT to do something, and it expresses that the decision has been reconsidered in light of the fact that it makes "too much sense NOT TO DO".
You might see it in this context:
"We initially hated Bob's idea because he was such a jerk in the way he presented it, but after further consideration, we had to admit that it made too much sense not to do."
