I also believe that method promotes hashing it out together. Outright rejection of an idea seems to put the onus back solely on the suggester to defend the idea without having been communicated the reason. That said, communicating the reason for rejection goes a long way towards making both process more equivalent.
The nice thing about working with very smart people is that when they have one of their rare very bad ideas, they are smart enough to see it right away as soon as they see you reject the idea (assuming they think that you are reasonably bright too).
For the more common case of bad ideas that are not super bad, then yeah, there probably needs to be some discussion to work out if they need to be rejected, or if the bad parts can be fixed.
If you can keep your ego disentangled from your ideas and from how people respond to your ideas, a group can move past the occasional really bad ideas very quickly, and spent most of its time on the good ideas, or on the not good ideas that have some good things in them that can be saved.
A typical conversation would go something like this:
me: [suggests some stupid idea]
friend: that's stupid!
me: Huh? [pause a moment to think about it, realize he is right] Oh, yeah, that was stupid.
...and then we move on. Sometimes the last line bit might instead be
me: Huh? [pause a moment to recheck my idea, and see that it was not stupid] No it isn't!
friend [pauses a moment, realizes that he was hasty] OK, maybe it was not stupid.
...and we then consider my idea.
I find this much nicer than the way it is often done nowadays, where what you have to do is try to get the person to figure out for themselves that it is a bad idea, typically by asking them questions designed to make them think about the area where you have spotted a fatal flaw in the hope that they will eventually see it themselves.
[1] Well, not always. Once someone hacked into my account on the mainframe, found something I was working on that had some stupid bugs...and they fixed them and left. I never found out who did it. On general principle I suspect Walter Bright. :-)