With regards to the low pass rate, from my observations being on courses and exams,
@wutangclan touched on a lot of them.
The commoditization of ski exams in the CSIA system definitely contributes to the low pass rate. In a system that doesn't require experience hours to be signed off before attempting the exams, you end up with people who don't work in the industry getting certified for the fun of being certified, taking exams for the fun of doing them, knowing that they don't have a chance of passing. A few seasons ago I went up to watch my friend attempt the L3, I ended up chatting with a fellow who was a doctor from Australia, this was his 5th attempt at it, and he treated it as a holiday, coming over every April to take a ski exam, just for the fun of it.
And then you have the people who might display great teach ability, but have no teachability. They can hammer out the teaching portion of the exam, but are too stubborn, or too physically broken to be able to change what they're being told to change. I'm not sure about the PSIA system, but it's possible to partially pass the exam, either the teaching or the skiing part. Those numbers aren't included in the "pass" rates.
Finally, you have the people on work permits who need that L3 pin to be able to secure sponsorship visas for next season, those folks are going to be taking the exams no matter what, a Hail Mary pass if you will, even if they have only had a season of work under their belts, since the clock is running against them.
Of course, there's also the folks who are just too oblivious to realize they're a long way off the standard and keep going to the exams anyways, failing, then leaving without bothering to ask the examiners for feedback. I've met a few of those over the last few years...