The role of the IOC is surprisingly limited. The committee decides eligibility (which is of significantly less importance than it was during the cold war), the standards for the medals, the location of the games and the program. The IOC does not conduct the competitions, the sports federations do. An Olympics can correctly be seen as a simultaneous world championship of many sports.
The highest accomplishment for any sport or near sport is to be included on the Olympic program and the non-Olympic associations work tirelessly to be included. And the ones on the bubble work tirelessly to remain on the program. And the program is always in flux, with events being added and eliminated (baseball, softball).
In recent years we've seen expansions of both the winter and summer programs, and each sport that's added raises the costs of these events dramatically. Construction of white water canoeing courses, half pipes and all the rest have bloated the Olympics almost to the point of being unrecognizable. In some cases, like Alpine skiing, events have been added to give great downhill racers a chance at more medals (Bode Miller) without necessarily requiring new and separate facilities. Skeleton has recently been added but uses the luge/bob sled course.
Certainly anyone laboring anonymously in the vineyard of a very small sport, like skeleton, has to be thrilled at the prospect of world wide TV coverage and an Olympic medal. Who wouldn't be? So the IOC's most important decisions these days, apart from where to place the games, is what events will be on the program. That's where these discussions of ball room dancing and other pseudo-sports come from. And the IOC, I think, finds itself in the position of saying "no" to very dedicated energetic people who want their sport to have the Olympic impramatur.