It's rather unhygenic I should imagine. So really that should be more of a worry then being impolite. Besides what do you do with it when you've picked it out --- yuk!!!!!
probably because when you see a person picking his/her nose, you are aware that the booger will have to go somewhere - and wherever it goes, unless it's into a handerkerchief is bound to be disgusting :)
It's rude because you see someone pick their nose and act like nothing happened, then you think about that kid at the restaurant who fixed up your taco, and your husband or whoever was manually *pleasing* you. LOL I checked out the link and I just find it hard to take them seriously without having a more official medical term than "picking your nose and eating it" Perhaps we should also take up licking our balls?!
Almost anything that leaves the body is thought of as disgusting to some degree. (The only exception I can think of is tears.) This may be on grounds of hygiene but I expect there's a deeper revulsion at work - that what belongs inside has been let loose, breaching the barrier between private and public.