If I might chime in, having gone through this process fixed width vs fluid or 100% width. There are two schools of thought.
100%/fluid width tends to adjust better to various monitor resolution settings. The problem is that with newer monitors (higher resolution) it can create alot of white space and start not looking as nice. I believe that kmart and amazon are examples of fuller width. (Although with their talent pool can probably get around drawbacks.)
Fixed width is somewhat easier to design for, as you can put in a photo and pretty much know how it will look. Most templates are by-passing the old 800x600 resolution, and those will have a horizontal scroll bar. All templates should look good in say 1024x678 and up. To a point. At very high resolution it can start looking skinny. Walmart used to be this way, and I think the default zen cart is this way: template set at about 750px width in stylesheet.
Most sites are now set about 950px or so in stylesheet (per our seo guy) which overall tends to look best in various monitor resolutions and gives good control of layout design. Target, Macy's & Bestbuy are some that should be about our width.
If your's looks especially narrow then you probably have a high resolution monitor?
If you try to "fix" your site at a larger width, say 1000px or more, you will have a problem with horizontal scroll bars in many monitors.
In short, yes there is a reason for this size. But your call as to what school to follow.
PS: Some sites try for optical illusion, having width about our size for most of site, but having header area full width, to cut down on whitespace and narrow impression. The ic-athmeme (?) zc template which I've used does this.