Minor modifications shouldn't require a new full review cycle, maybe just the editor takes a look, or just some quick check with reviewer to see if they accept the change.
Rejecting pending resubmission is for larger changes which require a more thorough review, but the journal is still interested in publishing the paper. This might be a section that requires more explanation, for example more details on how samples were controlled for other factors.
Also as mentioned a full rejection doesn't automatically mean the paper is rubbish, it could just be the journal doesn't consider it a good fit or similar. It's not uncommon for a paper to go through multiple rejections before getting published.
At least that's my understanding based on a close friend who publishes papers, feel free to correct me.
reviewers exist to find the dumb, obvious errors in papers that should prevent publication so as to not waste too much of other's people's time.
Peer review is only broken if you expect it to be something it isnt.