What did the Gemara think that this proved? Would that make us happy or sad - and why?

The Gemara does not think that this halacha of R. Yehuda proves that R. Yehuda requires 'hidur' in Lulav. What's the proof that R. Yehuda's requirement for using the same species is NOT based on hidur? Be specific!

Instead, what does the Gemara say IS the reason that R. Yehuda requires the same species to be used as the binding/eged? In your answer, please explain, using the concepts of לולב צריך אגד and the prohibition of Bal Tosif.