I'm not positive, but I think wainscots came from ship cabin interiors- something perhaps our British cousins came up with when the 18th Century Royal Navy had some pretty fancy Admiralty ships. I think that the wood rail acted to re-inforce the wall and act as a buffer against moving furniture (and people) as a ship rolled. It was later adopted (and widely used in many fashionable U.S. restaurants and hotels) to remind people of this nautical heritage. Plus it looks nice as an extra trim feature.