So here's the formula for what WWE is doing right now: (1) Give you big match with heel (HHH) going over. (2) Heel forms faction and throws everything but the kitchen sink at babyface. (3) Babyface finally gets come-uppance at WrestleMania.
The problem is, this is HHH we're dealing with, so here's how I imagine it really happened and will happen.
This is all speculation. (1) Nash unable to wrestle. HHH casually suggests he take his place, knowing working with Punk good for him. Says he'll put Punk over. (2) Uses Nash's ineptitude to slowly undermine Punk and casually throws out that maybe HHH should go over. Says it'll mean more that way when Punk finally wins.
The quote we heard a time or two, if I'm not mistaken, is "I really want to make this kid."
The faction formation gives you some stuff to work with in the longterm - babyface build is all about the "thrill of the chase," after all.
The goal, ultimately, is to make the up-and-coming baby look inept and never get the win back.
Or, baby'll rise above the BS and the return match will be huge $. That's the carrot he dangles. Rarely happens. He knows that. But HHH already got his win.