If anything, they should have just replaced the ride with another ride. That's the part to be mad at. Hopefully they won't be there TOO long, although there is a market for this type of thing and now with this, it creates a meeting place for every princess within Fantasyland alone, so I have a bad feeling it'll stick awhile until someone comes up with a good ride idea for that building.
You have to look at it from an overall guest and management perspective. That building isn't that big at all so this is perfect for it. For them to want to put a ride in there, it would have to be a very solid pitch, because right now they have alleviated the cost of running the ride system and as I said, the building isn't that big. The Philharmagic space can be put to MUCH better use, actually (not that i'd want to lose the show, but if it wwas either Philhar or groundbreaking dark-ride, i'd choose the ride every time).