A reason could be that it would slow down searches too much. Firstly, all your searches would have to hit a server storing your blacklist. Secondly, it makes caching results of popular queries neigh impossible. Finally, some people will build blacklists so large and convoluted that the top hit on some of their searches would only be on Google's page 20.
How about they build it in as a feature of Chrome? The servers can still send the canonical list, using cached results and all, but then it gets filtered down (and perhaps in the future reranked a bit) on the user's machine. As a bonus, it increases the value of switching to Chrome.
Aha, good explanation, thanks. I still have to think with all of Google's brainpower, they could figure something out. They already allow "starred" results, which I presume would function somewhat similarly to a blacklist from a technical standpoint (just showing instead of hiding).
