The process of getting reinforcers (treats or toys) off your body in preparation for entering an obedience or rally ring is something it's easy to overlook and rush. Most dogs act very differently when their handler has treats versus when the handler does not have treats, yet many people go straight from training with treats in their pockets to leaving treats on their crate and going into the ring.
When the dog starts off doing well in the ring, but then his or her performance degrades as the dog realizes that s/he is not going to get a reward, it can be very frustrating.
As the dog's performance gets worse, the handler tends to get confused and upset, emotions the dog can feel, leading to a further decline in behavior. As you can imagine, this can become a vicious cycle, and leaves the handler wondering why his/her dog shuts down in the ring.