There are many other factors they consider for home food preparation. These can range from having a residence with pets or children, to being within so many feet of a school, business center, or other stores.
It's not just the cleanliness and safety of the food, it's the surroundings as well. If you have kids, your kitchen is more likely NOT to be a safe place to run a business. Same goes with indoor pets. There is a much higher factor of dangers, accidents, and food contamination when kids or animals are involved.
There is also the areas of actual production. WHAT are you producing? How much? Do you have the necessary room for such production? Do you have the necessary and proper place for storage of ingredients? Do your appliances meet specific standards? It's not all about just being clean.
Like Daniel mentioned, there are some places that do allow home food production, but you have to have separate facilities for it. Usually, someone starting a home business will convert a spare room or the garage into a bakery or extra kitchen, for business purposes.
And even if you don't need those things, you still have to get inspected by the cities health board before you can work from home.
Cities or states usually don't enact strict regulations and laws unless there has been a major problem with the illegal use or abuse of it. It costs a lot of money and manpower to change or upgrade a law or regulation, so it's not something they do "willy nilly". More than likely, there have been too many reports of people getting sick from buying homemade goods.
Some alternatives to using your home for a home business:
1. lease or rent a small bakery, bistro, cafe, donut shop, or public kitchen short term. These places should already be set up for food preparation and production, you will probably just need a couple of portable ovens and your utensils and ingredients.
2. if you are able to work from home with little problem, but have to have everything separate or just need more space, look at renting or leasing a small house short term. There are always small homes that real estate agents and banks have on their lists for a long time for one reason or another, and you could probably work out a super cheap arrangement for a short term period.
3. If you have the room and your local laws allow it, get an RV trailer and park it on your property. It will take little effort to convert it to a small bakery. Although, you may have to get connection ports installed for the trailer.
4. Sublease a pre-existing bakery, cafe, or small restaurant. Some places may only be open seasonally or just a few days during the week. If you can do business for just a few days a week while they are closed, or do it seasonally to get your business started, then this would be something to check out. You could also sublease these kinds of places during their closed hours, if they are a full time business. You would be at their mercy for hours you work, but at least you would have a pre-existing place to do your work, so you don't have to spend a bundle to get your own place.
5. Look at small private bakeries, cafe's, etc.... going out of business. If they are going out of business, they may be looking to sell fast and get out. If this is the case, you can get a fully operational facility for cheaper than going through a real estate agent.