You are only looking at the one side of Olympics . Making money or not is a financial question and is totally depend on the management skills. You should know that a good CFO in a dead coop could just make it to fly.
The real impact of hosting Olympics in China is not the money. For China, it is an opportunity to get closer to the world and a good chance to keep the reforms deeper. For the western world, people can come and have a close-up look at the real China, both bright and drak sides. They will have their own conclusion which is not from CNN.
I do believe Olympics will construct a bridge over the ocean.