i was told by previously successful participants it was because i had a level of proficiency in japanese they didn't want. jet programme wants non-japanesespeaking foreign folks to come and teach for one year, then go home and rave about how great it is.
it's perceived that if you can speak and read japanese at a decent level you won't leave afterward and thus won't spread the word.
that's just what i was told. i applied four years ago and can honestly say at this stage in my life i am pretty damn glad i got turned down or else iwouldn't be where i am at now.
on the peace corps note, be careful because placement isn't guaranteed. a friend of an ex of mine got put in turkmenistan. can't say it's on myplaces to visit let alone work and live for an extended period of time.