Hi @bryner,
It does have to do with odds, yes. In this particular example you stand to lose 1 mBTC more than you stand to profit, depending on the result. However, as the odds shift so does potential profit/loss, for both the backer and layer. For example, odds of 2.00 is like flipping a coin: heads or tails. The odds are 50/50, and so each side stands to profit or lose the same amount. So, to answer your question of "why would anyone want to play a lay bet..." it's because they feel they are getting good odds about the bet.
In case you haven't seen it, one of our earlier articles covers this very topic: Back vs. Lay.