Why can't one see the ball all the way to impact? Most balls, after bouncing are not that fast. Moreover, since it is moving towards the subject, the lateral movement is not that fast for the eyes to follow except for maybe the last couple feet when the lateral component of the ball's velocity vector becomes greater relative to the eyes' position. Put it this way, you could watch a ball coming right at your face because there is very little lateral movement to track. A person catching a 90mph hardball can watch the ball all the way into his glove, right?
As to why we tend to look up, I think our brains connect hitting a ball to a target with throwing a ball to a target, but we don't realize that they are not the same. When we throw at a target, we are looking at the target the whole time, whereas when you hit a ball with an implement, well, you know..