but does anyone know why a bitcoin wallet would be refusing a transaction to a vanity address?
The bible quote in your signature reminded me of this hardcore Christian dude who maintained (maintains?) a patchset that blacklisted certain prefixes for bitcoin addresses. The blacklist worked by looking at the start of an address and rejecting vanity addresses corresponding to some gambling sites (e.g. satoshidice).
As I recall there was some drama at the time when this ridicilious patchset was snuck into the default build in gentoo.