He didn't at the time. He was coaching a fringe Top 10 team in a mid-major conference, playing on Versus, and competing for a Poisetta Bowl year in and year out.
There were plenty of incentives for him to jump to the Big XII and coach his alma mater.
Give me one example of a coach who spent a decade at a school, achieved high levels of success, and then left for a job—alma mater or no alma mater—that was worse than where he was previously.
Coaching at your alma mater isn't as thrilling as everybody makes it out to be, particularly if your alma mater is Kansas State. Patterson, because of his outrageous success at TCU, earned a step up to an elite school if he wanted it. He worked his ass off to turn TCU into what it has become.
Why on earth would he want to take on another rebuilding project in the middle of nowhere?
Depends on what you consider by worse? I don't think it was a cut and dried as you are stating.
K-State, at the time, offered him the opportunity to elevate himself to a BCS level coaching position in one of the top BCS conferences in the country, the opporunity to legitimately play for a national title game, bigger national tv exposure, and much better reward for a one, two, or three loss season culminatind in the New Years day bowl with the Big XII bowl tie ins, and yes, the ability to come home and coach his alma mater.
Yeah, he was successful at TCU, but like I mentioned, he was racking up some gaudy win totals in a second rate, mid major conference in the Mountain West. Had no shot at playing in the national title game with an undefeated season. Played all of their games in media obscurity. Had terrible bowl game tie-ins. And basically gained little to no national respect for all of their accomplishments because of their reputation as the big fish in the shittly little pond.
Again, that all has changed now that he won the Rose Bowl and is moving to a BCS conference, but at the time, those elements were not in place.