Yes, it's bad that this was advertised as a specific recycling program and involved parties knowingly or unknowingly diverged from that stated plan.
But from a global resource consumption perspective, it's far preferable to re-use good shoes (which also reduces the production of new shoes) than to recycle them for recovered material (which is lossy in terms of energy and materials).
The same argument about shoes may not apply to the specifics of say e-waste - where harmful materials, rare materials, or electrical efficiency come into play - but in the case of this article, we should be happy that usable shoes are being put on feet rather than shredded and chemically decomposed.