What's the number one reason why you reject manuscripts?
There is only one reason I reject manuscripts—I don't think I can sell the book.
Only a publisher would make that distinction, but it's an important one to understand. It's the reason why great manuscripts are sometimes rejected, while lesser manuscripts are sometimes accepted. I will sometimes accept a good (but not great) book because it fills a hole in my product line, or it's really timely and there's nothing else out there like it.
I always reject bad writing—poor technique, grammar, boring, unrealistic, facts and/or citations wrong, etc. The majority of my rejections fall into this category. I haven't done the math, but off the top of my head, I'd say about 90%.
I can't, however, always accept great writing. I will sometimes get a wonderful book that I have to reject because it's not right for my market (mainstream LDS) or I just published one that is too similar or I don't publish in that genre or I don't have the budget required to market it effectively. When this happens, I try to make it clear to the author that it is not the quality of the work I'm rejecting. These books nearly always find a home somewhere, and only rarely does an author feel the need to rub my nose in it. I forgive them because they clearly do not understand the distinction between accepting a book because it is good, and accepting a book because I know I can sell it.