Take my mare Mia as an example. She was born in 2001, so her breeding was set up in California in 2000. She was sweepstakes nominated, so the breeder presumably thought there was some chance she would be shown. Her sire won national championships. The guy who arranged the breeding, based on a quick Internet search, is still involved in showing horses.
At some point she was sold to a guy in Phoenix for use as an endurance horse. My wife talked to his wife once...she wasn't ridden much because the husband concluded he needed a gelding instead. Since she had no idea that she needed to pick her feet up to clear a 3" rock, and panicked at a 6" gully when I first started walking her in the desert, I'd bet her fearfulness resulted in her being kept in a corral during her time in Phoenix.
She was donated with another of their 6 horses to a charity that sold her. I don't know the whole story, but she was returned to the charity a few months later, 100-150 lbs lighter, with bite marks and afraid of other horses. The charity was told she fought with the big geldings in their pasture and wouldn't submit.
She was sold to me as 'perfect for a beginner'. A few years later, a trainer concluded she had either never been broken to ride, or had minimal training followed by years of nothing.
I don't know if she was born with a very nervous temperament or if she became that way because of how she lived. I know my "Total Newbie Riding Skills" sure didn't make matters better! And I know the trainer's initial evaluation was that she might never be safe to ride, or might only be safe in an arena. The trainer wanted to work with her, but also wanted me to understand that she couldn't promise a safe trail horse at the end.
I spent $2000 on having her trained from the start, and have now spent close to 2 years riding her out. She has almost become calm enough to be considered green broke. We're working now on solo trips. Give us another year, and she might finally be an OK trail horse...
The breeder in California had no idea that she would end up in Arizona, standing around in a corral and unridden for a few years. I think Mia's ending will be a happy one. I've put enough work into her, and like her well enough, that I'll probably own her until she dies.
The trainer who did so much for her said many of her clients would have put her up for auction instead of sinking money into a horse who wouldn't, in the end, be worth the training bill. And given her fear of strange horses, an auction environment would have driven her totally psycho with fear. She would be the perfect horse to send to slaughter - enough meat, but a nutjob with no value on the riding market and no incentive for anyone to train her.
The guy who arranged her breeding in 2000 never expected her life to be this way. She wasn't an accident. I'm sure a CMK bred mare in California in 2001 had decent market value. She isn't ugly. She is turning in to a sweet, willing mare. But in 2011, in Arizona, I couldn't have given her away.
My point is that the horse slaughter market is not driven by bad breeding. There certainly are bad breeders, and backyard breeders who have no business doing so, but an animal who can easily live 25-30 years will have a life no breeder can predict. No one intentionally harmed Mia. The sad truth is that a horse can be well-bred, never mistreated - at least, not in the sense of being abused - and yet still end up a candidate for slaughter. I wish it wasn't so, but I don't see that ever changing.