Some of you need to get your facts straight regarding genetics..
Even direct incest causes a tiny, tiny rise in the chance of visible problems, like insignificantly small. Exposure to a huge variety of legal household substances during pregnancy is infinately more likely to cause birth defects.
Genetics becomes a problem when people have a limited gene pool over several generations. Even then it increases the risk of inheriting negative characteristics or genetic diseases, which is an entirely separate thing from most birth defects.
It's forbidden because it's considered psychologically unhealthy. Dogs and most animals will happily mate with their siblings and/or parents, and there's no evidence of any instinct against it. The same goes for homosexuality (apart from not being forbidden and not considered, by most sensible people, to be psychologically unhealthy).
EDIT: There is some evidence that people react asexually to pheremone signatures which are similar to their own and that this might be some way of promoting genetic diversity, but I don't even think that's been confirmed, and besides, understanding of how pheremones affect us is still fairly in its infancy.
So yeah.. there's no non-socialized reason to be wierded out at all.