even ignoring the "it promotes tanking" premise, I think it could still be bad for the HBD product due to it causing unintended player supply issues.
As an example, I've started a process where I take guys who are "topping out" at AAA (e.g. a 29 yr old AAAA-caliber who sat on the 40 for a while, is out of options, cleared waivers and is now off the 40), and send them to RL ball to take up space. So I win plenty at the RL level by using AAA talent.
But the rub (and actually part of my plan) is that the guy retires at the end of the season since he got sent back to RL. I think of it as my one-man attempt to thin out the player pool of guys I don't think have MLB talent. But if everybody (well, even a dozen) did that, or even if owners held a guy who in LoA who could top out at AA if he got his promotions, the minor league talent pool could dry up. And then people would complain or just punt minors and it would be a mess.
I suppose this could happen even without a monetary award for minors WS, but why add the incentive?