I thought it had something to do with a falling out with Thomas Rongen.
IIRC, Rongen didn't choose him for U20 WC qualifiers, so when he got called in for the U20WC he passed.
I think it was just an excuse. He was of German and Serbian heritage and was probably always going to play for one of the two.
The Rongen deal just gave him an out without having to look like the a-hole.
I actually harbor more resentment to Subotic than I do Rossi, because he used the US youth teams to further his career and at least gave the indication that he would play for the US at the senior level.
Rossi always said he would play for Italy.