I understand why you don't agree with the decision, I believe it was a poor decision as well, but CIC can deny ANYONE a visa, regardless. It comes down to the discretion of the officer, who has decided that your wife doesn't satisfy the OWP requirements. Even applying dual intent, the officer can still deny her the permit. The officer could even deny you, a provincial nominee, a permit.
I do hope you are able to sort it out, whether by appeal or by applying again.
From OP 11:
Assessing an application where there are dual intent implications is no different from assessing any other temporary resident application. Each applicant receives the benefit of a procedurally fair, individual assessment and must, in turn, satisfy the officer that they meet all the requirements of IRPA’s Regulations relating to temporary residence, before any visa is issued. The existence of the CEC or the issuance of a Provincial Nominee Certificate does not change this. The possibility that an applicant for temporary residence may, at some point in the future, be approved under a Permanent Resident Program does not absolve the individual from meeting the requirements of a temporary resident, as set out in IRPA’s Regulations, in particular, R179, requiring applicants to leave Canada at the end of “the period authorized for their stay.”