It's hard to compare Olympic basketball/NBA to Olympic hockey/NHL. Hockey is way more competitive around the world, well specifically in northern Europe, Russia, and NA. But still, basketball is not even close internationally to the US on a competition level compared to basketball.
At the same time, I love the dream teams of the past and watching the US just dismantle the rest of the world is somewhat fun.
If they just wanted to make all olympic games an amateur event, then so be it. But that's not the case, so I think it takes away a bit when we aren't, as fans, getting to see the best athletes in the world competing.
This is similar to the World Baseball Classic that just finished before the MLB season started. There's always lots of talk about why teams would let their players play in that, but it's for the sport and your country at the end of the day. People want to see the best players representing their countries and a lot of the players want to play for their countries.
As for Ovie, it'll be interesting if he and others opt to play anyway and how the league reacts. The NHL likely made the right decision regarding their own product (essentially protecting their investment in the players).