I keep reading that one shouldn't have traces close to the edge of the board and am curious as to whether there is an electrical reason behind this or if it's a mechanical issue (like when they cut the pcb, it might somehow rip up the traces)?
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!