I see many electrical safety tips that caution against using Romex wire for extension cords, but never the reason. I'm guessing the reason is that the insulation is not durable to fit the grade, right? If not what is the reason? What type of insulation should an "approved" extension cord be constructed from? many thanks
The short answer is in the name. Extension cords should be made from "cord", not cable. Since this is usually "hard service" it should be some kind of hard service cord. Most OSHA inspectors have trouble with any field built extension cords anyway. If you do make one, be sure you have all listed parts, used in the way they are listed (no handy boxes with a Romex connector)
At one time, I was employed to do some tests on sundry connectors that were intended to be used with cords. One of the test was to hang a weight from the cord, to see if the connector did actually prevent the strain from being transmitted to where the wires were connected.
I did test several such connectors on Romex, rather than 'extension cord' material. In every instance, the connector failed to hold on to the romex well enough. That is, the outer jacket would work free of the connector, and you'd be left with the wires holding the weight.
I think that is much the same reason OSHA frowns upon the cord end replacement caps you can put on. After a while of use, they tend to work themselves loose from the cord sheath and expose conductors also.
On the cord vs cable naming issue: I recently used Bus Drop CABLE for a heavy duty "extension cord" from a PTO generator to my house - the setup had a interlocked breaker installed in the main panel and the whole shebang was passed by the ahj. My point: Bus drop CABLE was ok to plug and cord connect the PTO generator to the house. BTW I agree with the comments on strain releif using NM.
I'd say it's the shape and flexability issues i.e. it pulls out of connectors too easily and is pretty useless as an extention cord because it's too inflexible, plus I doubt that the solid wire has as high a pull-out force from the connector itself, though this is just conjecture. I think that the romex jacket durability v.s. extention cord durability is a fairly minor issue.