I feel as though you're taking a rather naive view of the situation. Currently Croatia isn't claiming the land as their own because it's part of a larger dispute, and if they do lay claim to it, they lose a larger chunk of more important land to Serbia.
Do you REALLY think if they allow ethnic Croatians to start building permanent settlements on the property in question, they can continue to claim that it's not theirs in the broader land dispute?
This isn't "a fun experiment that costs taxpayers nothing". It is a GREAT way to lose permanent rights to a much larger swath of land so that some people who think they're free from government oversight can play make believe. I'm not sure what the actual benefit to the people of Croatia is but I'm open to ideas.