Centralization is a continuum. Actions and circumstances move a particular system along that continuum.
There are several points which are topical here:
- Monero development is made by a smallish number of people (more centralized)
- Anybody with skills is free to join Monero development (less centralized)
- A single party being able to dictate what gets mined is extremely centralized
- Miners choose what code they run, regardless of what Monero developers do (less centralized)
- The Monero community previously backed a stance of forking to prevent hash rate monopoly (less centralized)
- Hardware with much higher efficiency than usual in the hands of very few parties is a very large centralization force
So when you consider this, you can deduce that, in this particular case, forking makes Monero less centralized than not forking.
Now, Monero is less decentralized that Bitcoin, which has more developers, and where the current mining distribution seems less concentrated. But more decentralized than many others cryptocurrencies.
I think one very important point that many people are missing is that of "but the Monero developers change the code, that's centralized". This is completely missing the point that Monero developers come and go, and that anyone is free to be part of this group. Indeed, a few people who have gone include NoodleDoodle (an original core team member), the late Warptangent, or tewinget. A few people who joined the developer team include moneromooo, hyc, or stoffu. Some are in both groups. What makes it seem centralized is that the current set of people who develop Monero are seen as a static "Monero developers" group, though this group is not static in the first place, it is just a term for whoever happens to be developing Monero at the time (many of these people being long term Monero developers, but not all).
Additionally, this was not fully without community feedback. While the original discussion was made privately to avoid tipping off those suspected ASIC operators early, public discussion was had afterwards to get to a consensus on what to release when.
As for your particular point about the longest chain: the rule is the longest valid chain wins. Once the fork happens, the chained mined by miners using the new code will not be valid anymore by the rules used by miners not using that new code, and vice versa.
tl;dr: That change in rules was made to help decentralization, and I believe it clearly does if you consider the points above.