Over the decades, Rei had given various accounts of this matter, and they changes over the years, as noted in one of the earlier accounts, it was related to women pros in Japan objected her participation (but later many women pros at the time in Japan rejected and denied this, or they were never consulted in this matter). Then later on there were several accounts from Rei said it was the Nihon kiin boards or those in power who afraid she might take the titles, and overshadowed all the women pros in Japan, or that allowing her to participate would open the door for Chinese players to join the Japanese tournaments (in the 1990s, Japanese title tournaments have the most prize pools, even today, still has one of the highest title prize). And this came from her hearing what other pros who supported her.
The official reason that we know of given by Nihonkiin had nothing to do with gender or how strong she was, but that she had her professional ranks issued by Chinese Weiqi Association, and without the permission and assignments from CWA, CWA pros cannot participate in games elsewhere.
Although the consideration behind the rejections I would assume go beyond some objections from CWA, but we simply cannot be sure (none of the board members from Nihon kiin had publicly stated anything about this, nor from CWA), and only accounts from Rei, and others close to her, and often years, or even decades later.