The Princess Royal's argument, which she put forward in a speech to the charity World Horse Welfare, is that people would look after their horses more carefully if they were planning to turn them into steaks and burgers later on. However, in our experience, any animal used for food is much more likely to be treated with disrespect than with respect. Given the regular exposés of mistreated pigs and chickens raised for food, it's absurd to think people would take better care of horses if there were a market for their meat.
An analogy that might be easier for us to relate to is to consider an individual driving their car every day of the year. If the risk to the driver was the same as that in a steeplechase like those at Aintree - six deaths in 1,000 - then you would be lucky to still be alive after six months. I doubt many of us would accept this, and yet it is still seemingly acceptable for horses to be exposed to such risks. We should also note that this risk is more than doubled in the Grand National Steeplechase.
An interesting social and artistic experiment has begun outside the British Council on The Mall in London. The artist Mark Wallinger has created a beautiful white horse -- a symbol of Olde Englande before it was even England (probably when it was Britannicus or just 'those pretty green isles' in Norse or French).