My impression is that the reason Larian isn't making BG4 is that they have more fun working on Divinity games. I don't think there's anything WotC could do to change that.
I don't think that's true.
The staff who worked on BG3, easily 50%+ of them had never worked on a Divinity game because they were new to the company, hired post DOS2. Another 20%+ had only worked on DOS2, and AFTER it was released (i.e. on the Definitive Edition - which was a big deal - they re-wrote most/all of the dialogue in the game among other things). Might be even higher. Certainly isn't lower.
Look at the credits on BG3, compare them to DOS2 and earlier games. Huge change in names. Even most of the senior people had never worked on a Divinity game.
Also, they're not working on DOS3. That's one of the few things they've actually confirmed, so the idea that they've not making BG4 because they wanted to make DOS3 is plainly and inarguably wrong. So with this idea shown to be false, we have to look at the actual timing of the decision, and it was directly
after WotC did fired everyone involved with Larian, and Larian's CEO publicly and harshly criticised WotC for this.
Further we now have confirmation that literally up until that point, they were in fact working on BG4! You may not be aware of that because the information came out later, the initial story from Swen Vincke was that they'd been sort of milling around and deciding what to do, then had decided against BG4. He later clarified that this wasn't the case - they were working on BG4 full-time right up until they decided to not do BG4.
I think the real explanation is probably fairly simple and two-part:
1) BG3 was a huge 6-year project which took incredible effort, went through a horrible, horrible pandemic, and likely involved a huge amount of overtime (even if not technically crunch), and people were probably somewhat "over" the setting and characters by then (and note, BG3 was and is still kind of unfinished - Act 3 is a shadow of Act 1, and Act 2 is very competent but extremely short). So the prospect of spending another 3+ years making a BG4 was probably pretty daunting for a lot of the team. But this absolutely wasn't some "love of Divinity" thing for anyone except maybe Swen (who is an wild man who thinks DOS2 had a better setting and better combat gameplay than BG3, both of which are bizarre beliefs). Again, they are confirmed as not working on DOS3.
2) They might have been wavering because of the $$$$$$$$$$$ factor, but when WotC also decided to fire everyone involved with working with Larian, that may well have pushed them over the edge. The idea that it's a non-factor is laughable given the timing though.