Remember that Literary Digest, which had correctly forecast the Presidential election many times through massive (but non-random) opinion surveys, forecast a comfortable victory for Landon. It wasn't irrational to nominate him, as the more scientific polling of Gallup and others hadn't proven itself to be better than very large non-random (and non-representative, at that) samples. So Republicans just didn't have the data necessary to select a candidate who could beat Roosevelt (if indeed, any plausible one could have done so). One fascinating article on the failed prediction of a landslide for Landon is Peverill Squire, 1988, "Why the 1936 Literary Digest Poll Failed," Public Opinion Quarterly 52 (1): 125-133.