Why is the taste of magic mouthwash so terrible?

Ingredients. None of the ingredients taste that good. The combination likely leads to something not that pleasant. Magic mouthwash is formulated by the pharmacist in a pharmacy so it isn't formulated to taste great like some over the counter products. The ingredients Diphenhydramine and viscous Lidocaine as well as the antibiotic likely lead to the strong taste.
Depends on the RX. The mouth wash is a specific compound formulated in the pharmacy based on your physician's prescription, ask your doctor if it is too strong, depending on your condition, he may be able to change the strength of the prescription and or change your medication. Good luck.