Once you build it, you own it. That should be understood in terms of the future of Kesey Square. It will be forever lost to any public activities once it is gone. For a square that is labeled as "an unfriendly void", I have fond memories of music events, beer tastings, a solar festival, art displays, and simply enjoying the sun while I people watch. 
If the plan is simply to open up the other two sides, that seems a good option. But any reduction in the size of the square would make it basically useless.