For some reason I am not elidgeble to play in tournament because my "timeout ratio" is higher than 10%. I don't even know what that is. Could someone please explain?

Its the percentage of your total games that you have lost on time, ie that you have 'timed out' in.

 

I imagine that the organisers of some tournaments don't want people to sign up and then skew the tournament results by losing lots of games on time

Chess.com, not tournament directors, set a blanket 10% timeouts restriction for tournaments.

http://www.chess.com/tournaments/help.html#register

Although it states tournament directors can change the criteria I have found that only the minimum number of games can be changed.

Ah, well I'd better start moving!