Yeah. Doesn't make any sense. I did a bit of research around that time. Washington had taken recently taken a survey of who they should hire as a new head ooach and Wilcox didn't fare well in it. Oregon only was interested in Wilcox because he was an "Old Duck" (graduated from Oregon after playing football there).
There was no real reason for Wilcox's contract to be extended. As has been pointed out. That extension occured, I believe, after Wilcox turned down the Oregon job.