Really. Here are the reasons:
1) If I can't write the rules down in a small space, they are probably too complicated. Rules need to be remember-able.
2) This size sheet of paper can double as a card in a prototype. I've played games with "decks of cards" made of these sheets of paper.
3) It is easy to swap in and out rules from the rules set as it is played, so there aren't a lot of hard to read scribbles all over the rules page. One or two related rules a page.
4) Writing by hand is more laborious. Its good to get bored, so I can get to the point quicker, realize when I am going on to long, and so forth.
5) I haven't invested a lot in anything by only using these cheap tools. Not being invested lets me feel like I can change something more easily, which is the state of mind I want to be in when I am inventing and refining a game.
6) Blank paper, as opposed to lined paper, lets me switch between sketches and diagrams and writing more smoothly, and I use both of those when designing.