The Station

From what I've read the reasoning behind it was sneezing was a symptom of a particularly bad and fatal infection going around in Rome back in the day. People would say "God bless you" as a small prayer that you did not have that sickness.

However, there's no real known history of it, so there's no definitive answer. The story that your nun gave you is actually a possible explanation as well. Breath had a very strong connection with life itself back before people knew anything about the body, and losing it violently through a sneeze could be interpreted as something worth a blessing to prevent.

from what i've heard, it's actually a lot more simpleminded. i've never heard either the thing the nun said, nor the roman sickness one. the one i've heard is that way back in the day, people thought it was a sign of the soul trying to escape. possibly due to some of the devil's tinkering, like "c'mere soul, i'm gonna pull you out the nose." actually, while i sit here typing this, i think milhouse explained it to bart on the simpsons this way: the "bless you" crams the soul back in. but i knew about this way before the simpsons. also, for whatever reason, i remember this being scandinavian in origin, but that might be horribly wrong