The third year is insurance against injury and ineffectiveness. If I had a shot at a guaranteed third year at a set price vs. the injury/aging risk, I'd hold out too.
You can't make that decision in a vacuum. How much does the 3rd year pay? How old is the player, does he project to fall off sharply in performance or maintain? What will the market be like after 2 more seasons?
Sure, getting a 3rd year reduces the risk for the player, but it is completely misleading to compare the TCV of a 3 year deal to that of a 2 year deal and treat the $ difference as if the player were completely unable to have earnings year 3.