I applied for a couple of reasons. It was a speculative application, I didn't know what to expect and I was hoping for some good experience of a complete application process - from the form and covering letter, up to the interview.
I also wasn't sure whether I'd like the place. I figured it's worth trying, and if I got it I could check the place out. I knew vaguely what it was like, but I wasn't sure.
Let's face it, it's not just about a supervisor being happy about a student - a student has to be happy with their working environment, too. I've definitely got the ability and drive to do a PhD, I've been working towards one for a while. I'm just not sure how much I'm prepared to sacrifice for one. And you're right - that is probably a stupid issue.