More speculation than anything, although his coaching style is more forward-thinking and reminisent to Keefe (and by extension, Dubas) than it would Babcock. Dubas was the GM of teams which McFarland was coaching, whereas Babcock doesn't really have any known ties to McFarland besides McFarland being a guest coach that one year (which also could have easily been Dubas, or maybe Hunter). I think if it were up to Babcock, he'd keep Hiller, whom he knows and trusts.
I'm sure Babcock is fine with McFarland as an assistant, but I don't think he's the one who said "Let Jim 'explore his options' so we can hire Paul" either.