Hello Cory,
I think you are spot on referencing the financial impact of maintaining a hazard that size. The club was in difficulty, as were many at that time, and filling that area in was probably cost effective.
As one of the guys leading the charge to have it reinstalled I am wearing my heart on my sleeve on this one. The pics of the original hole give us the guidelines and we can redo the 16th to make it fit. The problem is alot of folks think 16 is a great hole already and don't see the merits in the work.
So we shall see,
ed