First, it will not be good for the government to have the most of Bitcoin because they might find a way to control it despite being decentralised and that can't be good. It may be a good thing initially to help the price pump, but with time, it will not be.
For them it is good because they are mainly the ones that can benefit out of it but if we know an advance info about their movements we can also benefit on it. Being decentralized doesn't mean it is now free from market manipulation but the ones that being decentralized mean is that our funds won't get frozen just like what we experience on banks, Paypal, and other centralized entities.
Again, you can't blame the government for not buying Bitcoin, Bitcoin itself is risky in terms of volatility and they have to be cautious of what they can't control. And this doesn't mean they do not invest, governments invest in various ways and forms.
Yes. None is forced here anyways. Some governments can even do worse things like banning it. Instead of blaming them, we must be thankful if our government doesn't do this. Another reason to be thankful is like you said earlier, about BTC being manipulatable.