I've heard quite a few times that the commitees put a lot of work into considering the applications. If that's true, it shouldn't be that hard to come up with a fairly personalized letter rejecting you.
Just have one extra person taking notes for each applicant, and then include those notes.
As for "not all rejects are equal"--- that's the whole point. If I am nowhere near getting into a program, they can decide that very quickly, and tell me.
If you are close to a good fit for a job you'll normally get an interview, and the people will often honestly tell you what you're missing (or if they just don't have a position available). How did it come about that we're paying 60 bucks for a form letter?
There is obviously something very wrong with the system. Professors could be more communicative with prospective students; students could apply to less universities (applying to 10 is just absurd, at that point you're just gambling); but I'd assume mostly it's the people in administration's fault.
One idea I've had: universities should have stricter objective requirements for admission. You need this GPA and these test scores to be considered; or, if you think you're a special case, pay extra.