That team would have been really good-- before the three point era. (Nah. They can't dribble either.)
As a $16+M guy, Fultz is being paid like a first division starter. He's thisclose to Michael Carter-Williams. No, check that. He's been worse than MCW his entire career. 27% 3-point shooting. He also doesn't rebound well and, as a PG, he's an average passer at best. All that and poor defensive numbers to boot. His VORP is 0.0. That's replacement level. He's the Paul Janish of the NBA. Even if he improves, he's never going to be a great shooter and likely won't even be a good shooter. Orlando is a worse team with him on the court too. But hey, he's a name guy. So he's got that going for him.
Isaac is a bit more understandable in a vacuum, but it's just remarkably stupid for that particular team. He's got talent-- when he's on the court. But Isaac's not going to play this year at all and hasn't been able to stay healthy in his entire career. He plays PF, the most plentiful position in the league. If that were the only issue, I could see the upside gamble for health. (Maybe. Taking a massive gamble on big men's health is what gets GMs fired.) But it's an incredibly poor fit for the team as well. He's getting paid the exact same as... Aaron Gordon, another Orlando PF. So the Magic have allocated $40M for one position. Now, Isaac can play center too. He could play there, but the Magic have $25M man Vucevic there, not to mention another long-limbed maybe baby unicorn in Mo Bamba. And it's not like Isaac's going to blow up this season-- he's got a torn ACL.
Why not let these two go to RFA? If they blow up before then, you can bite the bullet and sign them. Or, if their feelings were hurt by your doubt, you could pull a sign-and-trade and acquire picks and bloated contracts of players who'd likely be just as good if not better than either player. Orlando just poleaxed their upside and maneuvering ability while guaranteeing they wouldn't be in on any free agents or big contract players looking for a fresh start in one fell swoop.