Incest~!

Pretty sure that's been proven wrong.

Or it's something like they did tests and found something measly like there's a 5% more chance of a child having a defect from an incestuous relationship than from a non-related relationship.

It's just 'not right' because it's a social taboo; it's not both.

Also; for Christians out there, if you believe that; we must all be retarded/mutated considering the whole Adam+Eve situation.

That is only one generation. If the family supports incest, then you'll have problems where you've got deleterious homozygous recessive alleles in your gene pool over time. It's not just a social taboo, nature has built in its own instinctual kin recognition ability within us so that we avoid sex with close relatives.