When Republicans see Hillary Clinton, they think "emails, Obama, Benghazi." She has been demonized in conservative eyes. While she and Bernie are similar in many respects, there is a trust issue, and Republicans simply aren't open to the idea of Hillary in the White House. A Clinton nomination guarantees that very few Republicans will vote Democratic. Bernie Sanders is appealing for some of the same reasons as Trump, and Trump has been getting voters from both sides of the spectrum. Clinton is too much of an establishment Democrat, and that is not what voters want.
While you may think that people like sensibility and moderation, the reality is that people don't want two candidates who are the same, or a watered down version of the other candidate. People want a clear alternative, especially when right now people are looking on the status quo with such disdain. Bernie Provides the alternative and can win.
Hillary Clinton has had much more time in the "spotlight" than Bernie, and Republicans recognize her name more. They associate her with the emails, gun control, abortion, and Obama. Bernie Sanders hasn't been a target before now, so Republicans might be more open to the idea of him. Hillary has become too demonized in conservative eyes. It's not about the issues: it's about the image.
Yes, I think Bernie Sanders will fair better than Hillary Clinton against the Republicans because Republicans strongly believe that Hillary Clinton is a liar and untrustworthy. Republicans view Clinton as a continuation of Obama's term because they share very similar views. On the other hand, Sanders' view is more radical and he isn't viewed as an untrustworthy politician.
It is difficult to understand why anyone would think that a woman with continuous court dates about lying would win an election. Hillary Clinton has not had a year off from accusation of wrongdoing as well as ethical issues concerning her husband. Bernie Sanders is actually addressing the issues that matter to the country as a whole. If Bernie wins against Hillary, we've got a chance.
In a choice that involves the lesser of two evils, Hillary Clinton would do better against Republicans than Bernie Sanders. While Bernie Sanders appealed to the populist notion of getting a "free lunch," more educated voters know his policies are proven failures. As far left as Hillary Clinton is, she is more moderate, and thus electable, than Sanders.
Sanders has brave, albeit very left policies. Though he's one a few delegates, he has a small chance against Clinton for one reason, moderation. Clinton is arguably the most moderate of any of the candidates offered, on either side. More moderate republicans have stated that they would vote Clinton in a Clinton vs. Trump election. Hillary has presence, she has trust, she has experience. She, in short, appeals to the majority of America.