I think one big reason is that rail systems have a much higher capacity that buses, and even when sharing street trackage with other vehicles, are a lot less prone to delays than your typical bus. It seems to me that most modern day light rail systems are being built with a separate ROW with an eye towards elemnating as much street running as possible. Keep in mind that trolley buses have the same lack of flexibility that rail does, since they are limited to where the wires are.
One thing to remember is that in some cases (Vancouver BC for example) buses replaced trolleys in the 50's and 60's because of the expense of having to rebuild track and wire systems that had been installed in the 1900's and, especially where tracks were buried in pavement, hadn't seen maintenance since they were installed.
Matt
Moscow ID
P.S. What I have posted here is largely my one opinion and observations. The part about Vancouver replacing trolleys with trolley buses was taken from Wikipedia, so take that with a grain of salt as well.