Let me begin by saying that I understand how difficult it is for the fledgling writer with a marked up manuscript soiling his workspace to feel any great affection for his editor. I understand that it may seem like we are out to get you; that we are butchers of a different variety---rather than flaying meat, we chop up words. We are, in effect, big bad wolves operating under the guise of sensibly shod book nerds.
Form rejections---the bane of every beginning writer's existence---do little to raise an author's love of editors. Not only are form rejections insulting because they are so damned impersonal, but they don't tell you a thing about why your work was given the axe. How are you supposed to improve if you don't know what the problem is?
Let's try to understand the role of the editor, both those working in-house, and those who work freelance.
It is the acquisitions editor who accepts or rejects your manuscript in traditional publishing. This may seem like a lofty, haughty position, but in fact, acquisition editors are under a great deal of pressure. A certain amount of precognition is required to be a good acquisitions editor---the ability to look into the future and see what will be popular a year or more from the time of their acquisition, and the ability to assess a writer's ability and the potential of a story as presented. They receive dozens of submissions a day from authors of every skill and experience level, they make quick decisions, they pitch manuscripts to a board that either grants or denies permission to offer a contract. However, while acquisition editors understand the business and are very knowledgable in the book trade, they are not writing coaches. In short, acquisition editors don't owe authors anything other than acceptance, or a form rejection.
Thems the breaks.
When you sell your manuscript to a publishing house, the real editing begins. However, while you may think this editor is free to manipulate the manuscript on a whim, the truth is that the in-house editor must conform to a set of pre-established rules when editing your work. Logically, the house wants all the publications baring its name to meet a certain standard. The house is the one footing the project's production bill, not the author, and that means the editor is working for the house, not the author. Production deadlines, budget size, and projected sales numbers play a huge role in the quality of editing the work will receive, not because the editor wants so screw the author---just the opposite is true, the editor's name goes on the project too, so his or her reputation is also on the line---but because they simply don't have the authority to do otherwise lest they risk losing their job.
Now let's compare this to ...
Freelance editors work for you, the author, and will therefore have your best interests at heart, not those of a third party. Hiring a freelance editor before you begin submitting your work should be considered money well spent. You and your editor will be free to take all the time you need to perfect the manuscript to the best of both of your abilities, therefore reducing the chances of errors slipping through into print if your manuscript is taken on by a smaller house with a low budget and a tight deadline. With a freelance editor, you will be free to make your suggestions and know that they've been heard, voice your concerns, point out parts you're not sure about, and know that she will do what she can to help you, all without having to worry about a boss breathing down your neck and grumbling about deadlines.
A freelance editor is, by all definitions of the term, your employee.
If you are planning on self-publishing your book, hiring a freelance editor should be seen as an absolute must. If your book goes to print with errors still present, you have written your book's death sentence, and likely that of your future writing career. Errors will reduce your book's sales numbers and earn it questionable reviews, which will further discourage sales. If your poorly edited book is the first in a series, you can kiss the rest of the series goodbye. No one (except for your mom) will want to spend their money on a second low-quality book.
If traditional publication is your goal, I highly recommend incorporating editing service fees into your budget before you begin the long, arduous task of submitting your work. Success means your manuscript has found a home and you will begin making money to pay off that initial expense. Or, worst case scenario, if it was your goal to find a traditional publisher but you failed in doing so, you can venture forth and self-publish with confidence, knowing you have a clean copy, and, therefore, better chances of selling this and all your future books (again, paying off the money you spent on editing). Likewise, if your plan is to keep all the control of your book by self-publishing, hiring an editor should not even be a question. It is virtually impossible to edit your own work. Here is an interesting article about this strange fact.
Editors (and agents) are not evil. We are not out to reject your work or to butcher an otherwise beautiful creature just for the sake of butchering. Editors need authors. We want you to succeed and we will do what we can to make that happen regardless of where we work.
I hope this helps clear some things up. Don't fear the red pen. It may be painful to see in the beginning, but like so many other things in life, there is pain before there is beauty. A good editor will do her absolute best to retain your original words, your unique voice, your vision. We may look scary, but not only are looks deceiving, we have the same goals as you.
And we really do like to wear sensible footwear.
(oh, one more thing I simply MUST clear up before I quit: line editing and copy editing ARE NOT THE SAME THING. Another name for line editing is stylistic editing---it is concerned with the quality of the sentences and paragraphs, not so much the rules of punctuation. True, some copy editors do function as line editors as well [ahem!], but the two are distinct roles that should not be confused. Just sayin'....)