There could be any number of reasons why a film goes directly to TV.
The number one reason is that it was financed by a broadcaster. I don't know the history of Horatio Hornblower but I wouldn't be surprised to hear that both ITV and A&E put money into the series of films. They probably also pre-sold it to a number of International Broadcasters to assist in the financing of the films. They don't want it to go to Cinemas because they can market it exclusively to their channel... This means higher ad dollars.
There are instances of films that were made of UK television that then were released theatrically in the US or Internationally. Increasingly, however, most films made for TV, while shot on film are posted online (i.e. digital editing like AVID, etc.) and output onto Digital Betacam (industry standard). They never edit the negative. The cost of making the transfer is realtively prohibitive.
The other thing that can happen is, that while the film looks good, the producers or distributors may not feel it has a broad enough audience to warrant the wide release and the P&A (prints and advertsing) budget that a theatrical release would require. In other words, they would make a reasonable amount of money but not enough to cover what it would cost to actually promote and release it.
The opposite is also true. I know of many UK and Canadian films that were released theatrically in their respective countries but ended up going straight to television (not even video) in the US or other countries.
Finally, they also make quite a bit of money in the video/DVD and ancillary rights (i.e. airline, hotel, ships, libraries, public performance, etc.).
(I do this for a living... does it show?
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