The reason usually given is because the Israelites were always on the move and fresh water wasn't available for cleansing the wound to prevent infection. However, that borders on being a gross generalization. Rashi writes that the people of Levi continued to circumcise their sons in the desert despite the risk (Rashi on D'varim 33:9). Rashi is held with high regard by Chabad. Never-the-less the popular consensus goes something like this ...
"During these forty years G-d was the only one providing. The Jews were not required to do their part. This explains why the covenant of Brit Mila was not appropriate in the desert where only G-d was contributing. Only upon entering Israel, when the nation of Israel had to once again do their part, was it fitting for the Brit Mila ritual to be resumed."
Without circumcision isn't there just as great a risk of infection? Do you really think that the Israelites didn't have waterskin bags with them when on the move ( Waterskin - Wikipedia ). The Mother could always use her spit to cleanse the wound if water wasn't readily available. Where there's a will there's a way. Necessity is the mother of invention 
...
"Should the idea of the Milah be understood as: Why cut the Ohrleh (ערלה)? According to some sources (mostly Kabbalic), it accumulates all of the baby's "filth" (זוהמה) during the 7 days since birth and must be cut (and handled properly) to avoid that filth to spread infection back to the whole body."
Do you think Moses told the Israelites not to circumcise the Hebrew male babies during their wilderness journey? Where in the Torah did G-d tell Moses, Aaron or any Levite not to perform a circumcisions on male babies born during the 40 years of the wilderness journey?
