There is no where near the concentration of oxygen in water as in their air, that is completely false.
Bacteria will live where it is best for them. Since the temperature in the tank is the same everywhere this is not an issue, although it would be if one area was much warmer than another. So, so far all areas are equal. They will live where there is the most oxygen and food. This means in the filter media where water is constantly supplied, so most bacteria will live in the filter. If you have any type of wet/dry this is even more true because there is SO much more oxygen there. They will live where it is most ideal. This does not mean an even distribution throughout the tank. Not any hard surface will have the same amount of bacteria as another, there are other factors besides surface area that greatly affect the distribution of nitriying bacteria in the tank.
With UGF more debris builds up in the gravel. And since a lot of your nitrifying bacteria are in the gravel it is even more vital that the weekly vacuumings are done to prevent the debris from choking out the underlying nitrifying bacteria, as well as long term nitrate problems.
I never said they don't work. They work, I would never debate that. In my experience most of the people who still use them have been in the hobby since UGFs were the best thing and are used to them, trust them, and perhaps are better at using them than newer hobbyists. It is simply that now there are better options, plain and simple.
In my experience tanks with UGFs are more prone to problems, from water quality and parameters, to disease and other issues. This is most likely at least partly, up to entirely, contributed to by less than ideal maintenance. But this even shows why they are not a good idea. It takes less screwing up and not keeping up with your maintenance to cause problems. What percentage of other filters cause problems for people? What percentage of UGFs end up causing problems for people? More with the UGF that is for sure.
The 90 at my work used to have UGFs. It was properly maintained. Even so, I added a canister and a little while later removed the UGFs and the gravel (replaced with crushed coral). When I did the tank looked like it was full of raw sewage. The visibility was literally about one inch. And yet there was no issue with the tank re-cycling. So much bacteria had colonized the canister that even the 'superior' media of the gravel itself did not matter, the nitrifying bacteria were mostly in the canister.
My tanks are all sand. It is much more natural, looks much better, and the least maintenance. Even without an UGF gravel traps a lot of debris. The fish seem to like it more too. It doesn't trap any debris and keeps debris on the surface. This means the flow in the tank keeps it moving until the filters grab it. This is the best option for substrate setup in my experience, unless you have live plants. I do, but only hardy stuff. If you really want to get into live plants that is a different subject.