Firstly, remember that when you're talking about WotC you're really talking about Hasbro. WotC is not the company it was at the turn of the century, it is controlled by a large corporation and that changes much.
Since WotC was purchased by Hasbro things have obviously changed. Peter, so long as things were reasonably profitable, did not take a typical corporate view of things. I don't want to put him up on TOO much of a pedestal or demonize Hasbro, but Peter often did things because he thought they were the right thing to do, without immediate concern for how profitable it was, out of his love for the hobby and those who share it. Now, I say 'immediate' concern because, I would argue, a lot of those things actually put WotC in a better position in the long run and, I think, Peter understands this.
Too many large companies want immediate gratification, often due to ignorant, impatient, or just plain greedy shareholders or owners. I've worked at more than one company that did things unquestionably detrimental to their business purely due to shareholder behavior (i.e. impacting stock values). Although, to be fair, would you (anyone reading here) want to spend your life making a meager living only to set your children up for an ideal life, or would you like to have at least some of that ideal life yourself too? One can't judge Hasbro too harshly for looking at bottom line numbers as they are a business and everything that comes with that. We can argue how concerned they are about making profits or with their employees, customers, well-being, etc. etc. but the bottom line is they are in business to make money. As to the best way to make that money? None of us, including Hasbro, necessarily know best how to do that.
There's a shifting line between short term and long term success that gets moved around by various factors. Hasbro obviously doesn't think GenCon is worth it. Maybe they think spending 1/3rd as much on three other Cons is a better return on investment. Maybe GenCon figured out they could sell smaller sections of the space Hasbro took up for a higher profit in the end and demanded more money from WotC and Hasbro turned up their noses. Maybe there's bad blood we don't know about. Maybe Hasbro thinks RPG's are dying and that the customers they do have don't really need to be advertised to. We can only guess what the primary reasons are. Pre-Hasbro WotC did things for good-will and visibility that I would argue made them a better company, both in principal and longevity. Things that Hasbro obviously doesn't place as much value in. The 'why' we could argue forever.
Fortunately, it's quite apparent, this hasn't had a negative impact on the convention itself though. It's been growing steadily and has, for the first time, actually 'sold out'.
I moved away from D&D in the early 90's and there are plenty 'carrying the torch' for it at GenCon, so it's not as if we're missing out on the game itself, but I do think it's a real shame WotC did not do something for GenCon 50 - even if it had been to start their own con. I really think the current owners of D&D should have stood up, taken a bow and acknowledged the importance of the entire event. Tabletop RPG gamers are a bit of a different breed from your typical customer and I think it does leave many us shaking our heads a bit.
WotC not showing up has nothing to do with costs/profits/bang for the buck Gen Con vs. other cons.
Also interestingly it looks like Star City isn't going to be there this year either