It's almost no-lose this one for Khan. Nobody expects him to win, and he won't But it won't harm his standing in the sport, and will enhance it if he acquits himself well, which I would expect him to: Khan wins rounds, particularly early in fights, he loses because he gets knocked out (except the Peterson fight, where he was harshly scored, and harshly deducted points by the referee). Alvarez isn't a huge puncher, so Khan might have the whiskers for this one.
Size and Khan's inactivity are the big problems. But he can go fight Kell Brook after he loses this one, and that fight's magnitude won't be diminished by a loss here.