There's nothing fundamentally wrong with their algorithm; it just isn't considering motivation. The Redskins and Titans each play a superior team in Week 17, but their opponents, the Cowboys and Colts, will be resting their starters for the playoffs while Washington and Tennessee play their hearts out to get their respective 6 seeds.
Tennessee opened as a 4-point favorite against Indy, and would probably be about a 7-point dog if Indy was trying. That's a huge swing, enough to make them substantial favorites instead of severe underdogs. Washington would ordinarily be an underdog to Dallas, but facing an unmotivated Cowboys team at home, the Redskins will probably open as solid faves.
Here are my updated odds estimates:
Edit: If you're wondering how the Giants' chances managed to get worse despite their clinching a playoff spot, bear in mind that they were almost certain to get in the playoffs anyway, plus I tweaked the numbers some.
That Titans number is not a typo. To win the AFC, they have to win at Indy, at San Diego (or Pittsburgh), at New England, and probably at Indy again. That's one brutal path.