sasuna is correct.
The past progressive is often used when one action (in the simple past) interrupts another which is ongoing (past progressive). This is just the negation of that.
Consider: We went out while it was raining. (Going out "interrupts" the raining)
The negation is: We didn �t go out while it was raining.
Now if you substitute "because" for "while", you have your sentence.
We didn �t go out because it was raining.
Bruce