The logic seems pretty easy: it was so limited in availability that it benefited very few workers.

So very few people will miss it.

It would be a totally different situation if this were a perk where there had been plenty of supply, so that it actually met employee demand.

What's hard to grok? Its capacity was 300 children, so fewer than 300 families at a location where there could have been thousands of families that could have benefited. It served an insignificant fraction of the employees at Google who could have used it.

It probably annoyed the huge majority that got rejected - probably created a lot of resentment