To me it makes absolute sense, not only to maximise the playing opportunity of contracted players but also to boost the overall chance of this competition surviving.
Fans and clubs will need to be unselfish in supporting this competition, having up to 28 contracted players in Melbourne/Perth when only 22 of them will ever play runs contrary to the reason as to why this competition was established in the first place.
If Sydney has 4 or 5 teams, the calibre of players across these teams is going to be spread thin, teams like the Rebels and Force will be of Super Rugby quality playing against Shute Shield teams. If you want the competition to have any form of balance then some teams will need to allow players to return to Sydney.
Furthermore, from a marketing perspective, having a greater number of super rugby players with profiles in some of these teams in Sydney will do wonders for selling tickets and building interest. Sydney is realistically the focal point in all this, the competition needs to grab hold in Sydney or its going to fail, it won't matter what happens in Perth, Melbourne, Brisbane or Canberra, if the Sydney teams are a failure then the competition will fail as well.