There are also rules as to what cannot be placed in a cache, specifically explosives, ammo, knives, drugs, alcohol and food.
Food is on the list because most caches are placed in wilderness areas, and animals have a better sense of smell than we do. You don't want an animal running off with or destroying your cache.
The other items are just common sense. Geocaching is a family sport. There are young children out there finding these caches so you don't want anything dangerous in there that could hurt them.
And no, all geocachers are not "greenies". Why would you think you'd have to be a greenie to enjoy getting out in the woods? We've found some pretty good impromptu shooting ranges near some caches in the desert....and we go armed.
As I said before, I highly recommend the sport for the pure fun of it. You get to see a lot of country that you wouldn't normally see. And the satisfaction of actually finding the cache is great, too.