Saturday's Premier League fixture pits Warnock against his former employers, the club where he became a fans' favourite over the course of two seasons and earned a call-up to the England squad.
Allardyce admits he did not want to see the 27-year-old, but said the reported £8million deal sealed in August represented good business and that there should be no ill-feeling towards the player.
Asked if he expected Warnock to be applauded by the Ewood faithful, Allardyce said: "I hope so, he has been a great servant to Blackburn.
"He got the move he wanted and we got the money that matched what we felt his value was. We were satisfied with that, even though we were disappointed to lose our player of the year.
"When you see Manchester United selling (Cristiano) Ronaldo then you see it's a business. When somebody is giving you the sort of money that we got for Stephen, then you can't say no.
"I didn't want it to happen but in the end it did. I think that, as always as a manager, you learn to live with the difficulties that the transfer window brings your way.
"The best thing we did was we got the right price, then we moved on and after that we got a really good replacement in Pascal Chimbonda, so we won't miss Stephen Warnock perhaps quite as much as we expected.
"It's a fantastic move for Stephen, the right time in his career, so I've got no problems with that. We just hope he plays not so good on Saturday, we beat them and then after that he can go on to win as many things as he possibly can!"
Blackburn, who currently lie third from bottom in the Premier League table after picking up just four points from their first five games, have their work cut out against an in-form Villa side who inflicted Allardyce's only defeat at Ewood Park last season.
Martin O'Neill's side recovered from defeat to Wigan on the opening day to win their next four games and, with Gabriel Agbonlahor spearheading a potent Villa attack, Allardyce knows his defenders will have to be on their guard at all times.
"We need to play the right way against a very tough Aston Villa side who have won all three of their away games on the trot," Allardyce said.
"Tactically we have to be ready for them and as individuals we will have to play to our best tomorrow.
"If we don't do that then Aston Villa can pick you off and make life very difficult for you - as we found last season when they came here.
"We have to nullify a very potent, pacy, quick Villa frontline.
If you leave them too many spaces as we did last season, they end up picking you off, and while you might be the best team in possession or have territorial advantage, against Aston Villa it doesn't mean anything.
"You must concentrate on the fact that when you lose the ball these guys with so much pace can go from one end of the pitch to the other in a flash and stick the ball in the back on the net.
We have to make sure our defenders are concentrating fully, even when we are attacking."
Allardyce labelled his team's performance in last week's 3-0 defeat at Everton "unacceptable" and, having seen a side with 10 changes grind out victory at Nottingham Forest in the Carling Cup, the manager confirmed that places were up for grabs in the starting XI.
He said: "There's only El-Hadji Diouf, Chris Samba and Paul Robinson for me that played to their potential on Sunday, which is pretty poor, three out of 11.
"The rest were pretty below par for them - lots of effort but
lots of misguided effort unfortunately. So nobody can complain if they get left out."
Diouf has been at the centre of controversy after police decided to investigate allegations that he made a racist comment to a ballboy during the defeat at Goodison Park.
Allardyce confirmed Diouf would be considered for selection for the Villa game, while a spokesman for Blackburn Rovers said: "We are in dialogue with Merseyside police and the investigation is clearly ongoing.
"We feel it would be inappropriate to comment further until the
full facts are known, which we are advised could be next week."