This explanation is "
straight from the Horse's Mouth".
Some say this is originally a boast of confidence from a
racetrack tipster, who would say he gets his
information from the
horses themselves—thereby assuring the bettor that the
info is the correct.
Another explanation is that a horse trader would persuade a
prospective buyer with all kinds of talk
about the animal, but for a clear measure of its worth, one can simply look in
the animal's
mouth. You can tell a great deal about a horse from its mouth.
Age,
nutrition, general health of the horse, and if it had been over reined.
If a
horse is unruly you have to rein it in a lot, and this shows in the horse's
mouth as well.