This is completely meaningless and unimportant. Unfortunately, real people don't generally act like the "economic man" you (and I) learned about in Econ 101. Real people value social ties and community, even when the dollar value of those things is quite low. Citizenship, especially for small countries, is a form of community. Selling access to that community to outsiders who may not respect the social norms and values of the community is therefore objectionable to many people.
It's completely meaningless and unimportant that there are real, concrete, benefits because some -- but evidently not a majority of voters -- admittedly irrational people have their inchoate feelings hurt?
€650,000 can go towards education, social safety net programs, or a variety of other worthy causes, but the important thing is the feelings of rank nationalists who are upset that their precious citizenship cum identity is terribly diluted by being sold rather than being acquired by falling out of the right vagina. Because after all there is requirement that a natural born citizen participate in the "community".
