Why would anyone want to work for the Dread Pirate WOTC anymore?
There are lots of potential reasons. One is that it's just an amazing experience. During my 14 months in RPG R&D I met some stunningly cool people, got to work with giants of the industry (many of whom had written the very same game material I used to have fun summers in my mother’s garage as a teen years beforehand), and learned more about game design than any period even twice as long before or since. I sat next to Monte Cook for quite a while, and just a cubical divider away from Jonathan Tweet, James Wyatt, and Rob Heinsoo. Mike Selinker and Rich Baker had offices right behind me. Thomas Reid was my boss at first, and then later Chris Perkins. Most days you could learn a lot just by sitting quietly and listening to those people's conversations (one reason writing for Wotc is differently than doing the same work from home), and if you had a question of your own look at the list of people you could ask!
Now a lot of those folks are gone, along with many other people I have kept in touch with (some of whom, such as Chris Pramas and Stan!, I still work with), but WotC still has some of the best game designers on the planet. So if I had a chance to spend time in the same office as James Wyatt and Rodney Thompson again yeah, I might well take it despite being laid off once before and knowing most likely I’d end up getting laid off again eventually.
Another reason is love of the game. D&D is near and dear to my heart, and the lure of getting to play in the official sandbox again might well be more than I could resist.
Also, to be honest the money is better there than for nearly any other rpg design job.
How many game companies need to spring up and eat WOTC's lunch before they realize how important taking care of your people is to long term success?
My impression remains that corporate WotC and Hasbro do not see any of the companies created or run by ex-employees as competition. None of them come close to touching Magic's numbers, and I bet Wotc sees success of things like Pathfinder to be irrelevant to how D&D sells.
I *disagree* with them, but that's my take of their belief.