The problem with baseball's economic system is that it would be very difficult for Boston to sign him to a "stupid" deal by their standards. Even if they only get $10 million/year production at a $25 million/year cost, they can afford to eat that difference.
Bryan Cashman and Theo Epstein get credit for being these great GMs, but both have made numerous moves that would have crippled any other franchises. The difference is that they have the budget that they can afford to eat their mistakes and move along to the next product.
I think the beginning of the end for the O's was the firing of Davey Johnson. Then, that offseason, Angelos nixed a Frank Wren trade of Alomar/Palmeiro in exchange for Baerga/Olerud to the Mets. He was right to nix it, but it also led to him thinking that he was smarter than anybody else in the room on baseball matters.
I do think he felt burned on the Belle deal - but he got 70% of that contract back in insurance, so it he shouldn't have let it affect future decisions.