It's not backward thinking. Narvaez would have been forced to put his nose in the wind to get back any deficit in an ITT. You say more ITT riders would attend which is possible, however, Vine and Plapp would hold their own in the ITT. I think if the organisers want an Aussie winner, so give them an opportunity. It would also mean the result is less reliant on bonus seconds.
It's backwards thinking because you are presupposing a fight between Plapp, Vine and Narvaez which is the wrong way to start thinking of it. One should instead start by defining the competition and then whoever wants to show up for the race shows up. There are lots of riders who are currently not attending who might suddenly want to attend. Perhaps even Remco would want an early season trip to Australia or else you have the likes of Ganna, Küng, McNulty, Affini, Bissegger, Ayuso, Armirail, Arensman, Vauquelin, Foss, Campenaerts, Segaert etc etc who might suddenly choose to attend.