Why is it bad to have traces close to the edge of the board?
From Sunstone (my favorite high quality short run PCB shop)...


  A very high percentage of orders are placed on hold due to
  insufficient board edge to copper clearance.
  
  We care about exposed copper at the board edge for a couple of
  reasons.
  
  
  Copper can tear when it is routed, leaving strings that can short to adjacent layers. 
  Exposed copper can wick solder in a wave solder process, causing shorts at assembly.
  Exposed copper at the board edge can make contact with your product chassis, causing a short to ground and/or risk of electrical shock.
  


So, both mechanical and electrical!