And we know which of the two has the most lobbying muscle in Congress...
There's also the fact that rules aren't perfect because reality is complicated. At some point, this was allowed, and then someone figured out a way to abuse the hell out of it, and they responded by banning it for everybody because they can't realistically discern the abuse cases from the acceptable ones.
Then there's the disconnect between the officials who pass a law (for a specific purpose), and those charged with enforcing it (who may go by the letter of the law even in situations the original legislators did not foresee, or be a normal lazy bureaucrat and pursue the "easy" examples).
All three of these rules come into play hard for areas of medicine and food, hence the FDA, because screwing up has lots of potential danger for the public.
So, while seemingly stupid things like this might be things we all agree are dumb, it's also unsurprising. I'm sure there's people who thought they had a good reason to ban home-bakeries.
But I also suspect that if we employed better legislators this wouldn't have happened, and that lobbyists have made damn well sure this sort of stupidity doesn't negatively impact them.
(this is something people should keep in mind when they argue against the existence of lobbyists - many legislators are REALLY STUPID. A lack of lobbyists in some situations could very well result in legislation that is worse for everybody - at the very least having lobbyists means there is SOMEONE involved that might have an idea of the actual effects the legislation will have)
And... of course... everyone in the comments somehow blames Obama for this bullshit. lol