Until this cycle, the GOP rule was that the candidate who came in second previously got the nomination. In 1988 Dole came in second, in 1992 Buchanan came in second. In 1996, there was a bit of confusion about the order, it just took until after NH before the voters decided first in time, first in right.
Wow, I hadn't realized that. Excluding years with a Repub incumbent, this has worked every year since 1980 with the exception of Bush II in 2000. Wonder how much of this is a coincidence.
2012 - Romney - Yes
2008 - McCain - Yes
2000 - Bush II - No
1996 - Dole - Yes
1988 - Bush I - Yes
1980 - Reagan - Yes
As for the topic question, Buchanan is very far right culturally (even though some of his economic stances appeal to working-class Democrats), and the GOP had enough moderates then.
