Salamun Alaikum,
Immorality and modern day Olympics are two different things. Immorality is a part of every day life with or without the Olympics. If people want to engage in 'fahisha' (lewdness), then they will do so whether it is a secular society or one that is supposedly 'Islamic' with or without the Olympics. When someone hosts an event, they do it with good intentions and not with the incentive to cause wanton debauchery and lewdness.
Now I do agree that there is much immodesty for e.g. in clothing in certain Olympic sports and yes the nature of some sports would arguably conflict with Islamic values even from a Quranic perspective. I doubt very much that even a Quran based society would be open to host such an event although they may choose to participate in 'certain' events in other countries if it satisfies Quranic criteria.
Regards,
Joseph