It would mean a best of 5 tournament each month for four months in a row. If it was best of 5 then it would be over two weeks and would fit even less into the tennis calendar. It would not work.
I still don't think tennis should be in the Olympics. Nor should football or golf, which will join in 2016. These are sports that have their own big tournaments and history. It is almost embarrassing how much more important Wimbledon is than the Olympics for tennis. That shouldn't be the case for an event in the Olympics Games.
Obviously the prestige will increase if Djokovic wins and even more so if Federer wins. Nadal winning added prestige as they could now refer to Agassi and Nadal as Olympic champions and gloss over the likes of Rosset and Massu. If big names continue to win it, then its standing in tennis will increase.
Talking of 5 sets though, they should definitely change the final of the YEC back to a 5-setter. I understand them changing the Masters Series finals, but they should not have touched the YEC.