Very good answer Ben!
The partial pressure of O2 at FL180 is 50% that of sea level.
As you go higher, the rate of partial pressure change decreases more
rapidly, so that by FL270 it is into single digits.
A pressurized mask is necessary to force the air into your lungs and
into your blood.

Ben Hallert wrote:
I think the other posters have it right. The specific concept behind
it, if I remember my science fiction books correctly, is 'partial
pressure'. With the open cycle (the one that hooks to your nose),
there's an open path direct to the low pressure area through your
mouth. The oxygen enters your lungs through osmosis, and if the
pressure on the inside of the hemoglobin in your pulmonary capillary is
greater then the pressure of the O2 against it, it just won't enter.
Another part of the problem may be that at high enough altitudes, CO2
may no longer be effective at triggering the breathing impulse.
I think the partial pressure issue is probably more relevant.