Well the theme of 'wishes' goes back a long way. There are various beliefs about how candles first found their way onto birthday cakes. Some believe the Ancient Greeks thought that the smoke of the candles carried their wishes off to come true, high above our mere physical locations here on earth could reach. Others believe the Germans were at the root of this tradition, their candles symbolising the light of life.
For me it's enough that it signifies your very own momentous occasion and is something you can count on every year... one more candle on your cake declaring another triumphant year of your life.
As for the second tradition (not cutting all the way to the bottom in case you have to kiss someone) - I think that was created just to have a bit of fun at your expense! But if you know about how this started - it's cupcake prize time again!