UFAG was under .500 last year also. Yes, it's always good when a rival has a losing record, but I would rather another rival not have an undefeated season. Those are a lot less common.
FSU having an undefeated regular season record is a big deal. True, FSU might not go very far if they make the playoffs, but making the playoffs is also a big deal. Those are big time reasons that might sway a recruits decision, or a talented player in the transfer portal.
It meant a lot more for FSU to lose this game than for UF to lose this game just so they would finish under .500 and avoid a meaningless bowl game.