Breakfast is a high margin operation for most properties. At a typical chain hotel, the vast majority of people choose a buffet of some kind and that tends not to have anything particularly costly on it. The space is already a sunk cost because it is otherwise empty and it is a training ground for staff.

As noted, people who are simply reimbursed could care less and others find it awkward to walk out when they figure out that that they are eating a $5 meal for $25 + tip when they could have something tasty enough down the block for the $5.