It's essentially opportunity cost. The Play! Pavilion was a bad idea from the start and would have been incredibly outdated quickly -- possibly within 5 years of opening. If there was a guarantee Disney would then rework it, maybe it could have been okay, but that's pretty unlikely given their standard MO. It's more probable it would have operated more or less as it did at opening for 15-20 years.
Would EPCOT be better off right now if the Play! Pavilion existed? Sure, because it would have additional capacity. In the long run, though, EPCOT is better off if the pavilion sits empty for another few years and then opens with something that actually offers a full pavilion experience closer to Wonders of Life (not in specific health content; just in terms of attractions, snacks, etc.).
Look at Imagination as an example -- if they'd shut down the second iteration for several years to do a full reworking and open with an actually excellent attraction and side activities, EPCOT would have been worse off for the years it was closed due to a loss of capacity, but would be in much better shape right now.
The only reason it's still a potential negative IMO is that the pavilion has already been empty for well over a decade. It's absolutely possible that Disney just lets it sit empty for another 10+ years, and if that's the case, then obviously the Play! Pavilion would be better than nothing.