On paper your son should be in as should mine. I will post an update if we are able to find out what about his application/profile is undesirable.
Yes, our sons, in the long run will be fine. The sting of not achieving a life long goal towards which they've worked so hard hurts badly though. Especially as many of their peers are celebrating their acceptances. It's a lesson in overcoming disappointment and being humble.
Best of luck to you and your son.