The issue, I think, isn't that it's a VILLAGE but that it's not directly adjacent. Having a "Science Centre" station on the Crosstown makes perfect sense, for example. But "Pioneer Village" could have been more accurately called "York University Track and Field" or "UPS Parking Lot."
(Even in the case of Science Centre, Don Mills is really just where the parking lot ends so that one is debatable too; but at least PART of the centre is there. Maybe when the Celestica site is redeveloped, not calling it Don Mills will seem sillier but it at least makes some sense.)
But the core issue was the process. I forget all the details but TTC has an actual naming policy and, over the course of like a year, tossed it out the window. Changing Downsview made sense and when Vaughan changed from VCC to VMC it was a fair request by Vaughan to call the station that (despite all the syllables) but that request touched off a whole, "Wait - we can just change the names to whatever we want??" frenzy. They rendered their own policy meaningless. I don't even know if it's still on the books in any form. (You can see it on P.4 of
this 2010 document.)
Yeah, it's a stupid name given the geographic context, especially given how rarely (e.g. Museum) TTC uses a name that's not an intersection. But it's done and, really, over the long term who cares? Heck, Black Creek is a nice place to take the kids so maybe it will have the side effect of bringing a few more people up there. They'll have a bit of a surprising walk once they're upstairs but still...