Here is what Chabad says about it:
http://www.chabad.org/holidays/passover/pesach_cdo/aid/1680/jewish/Handmade-and-Machine-Made-Matzah.htmAbout one hundred and fifty years ago, a machine was designed for baking matzah. Most of the process was automated and the matzot were untouched by human hands.
The introduction of the machine created a difference of opinion among the halachic authorities of that time, a difference of opinion which continues to this very day. Some authorities permitted the machine made matzot, whereas others prohibited them. Both sides offered reasons to support their contentions.
Those who permitted the use of the machine made matzot contended that these matzot are preferable, since the automated process is faster than making matzot by hand and there is thus less possibility of the dough becoming chametz, provided that special care is taken to ensure that the machinery is kept clean and that no dough is allowed to remain in the machinery between the processing of one batch and the next.
Those who prohibited the use of machine made matzot contended that baking matzah requires conscious intent that it is being done for the purpose of fulfilling the mitzvah.
Machines can have no intent, and thus, matzot prepared by machine lack this prerequisite. They also pointed out that the intricacy of the machinery makes it extremely difficult to ensure that no dough remains in the grooves or gears, for if dough is left in the machinery, it will render subsequent batches chametz.
Furthermore, since the parts of the machinery are made of metal and generate friction, the heat may cause the dough to ferment more rapidly.
Additionally, our tradition that fermentation occurs if the dough is left unworked for eighteen minutes applies to dough that was prepared by hand.
We have no tradition as to when this will occur in dough prepared by machine. Because it is feasible that such dough will ferment more quickly, we should be stringent, these authorities contend, and retain the original hand method of preparation.
Another objection was raised as well. The use of these matzot was liable to harm the poor, for many indigent families looked forward to the several weeks before Passover when there were abundant work opportunities in the bakeries and they could earn enough money to provide their families with the holiday needs.
Those who permitted the use of machine made matzot, and they are the majority today, countered all these arguments, and it is generally accepted that the obligation of eating matzah on Passover can be fulfilled with machine made matzot.
Nevertheless, many people take great pains to use handmade matzot for the mitzvah of eating matzah at the Seder. Some people are even more stringent and will use only handmade matzot all of Passover.
