^ Ding ding ding
This is exactly what happened. Lasseter was getting jealous of all the attention being paid to Marvel and Star Wars at Disneyland, and Pixar Pier was proposed as a quick and cheap way to placate him. Nobody at WDI liked the idea, but everyone went along with the idea anyway. And Lasseter's "requests" on the project became increasingly weird and intrusive.
The sad part? From what I understand, the final greenlight came through mere weeks before the Lasseter scandals started emerging. Frankly, with his increasingly diva-ish behavior around WDI, I think many were glad to be rid of his influence.