I've heard that the most common situation where managers have a heart attack is when they have to fire somebody. Saying "No" is stressful, and thinking about doing it courteously is not easy. I know it takes me more than 10 seconds to think about a way to say such things nicely.

And I think being too specific could make matters worse. Think about dating. "You are a nice person, but I don't really like your nose" - helpful? I think not, and the next person might be just fine with your nose. I think the generic letter YC sent (I got one, too) is a good solution. And I could imagine that if you would ask them, they might be willing to give you more specific information.