backing out of a stake because you can't play the tourney for whatever reason is fine
backing out of a stake and then playing the tourney anyway is pretty bad form
+1I don't know any of the people involved, so this is an opinion based only on the sequence of events as I read them.
If I'd shown faith by staking someone who is, shall we say, "unproven" and therefore a bit of a risk, I'd be very upset if they withdrew the deal at the very time they've won an event and perhaps become a better bet!
That would seem very unfair to me. As Tom says, a deal is a deal and even if the goalposts have moved, you should stick with it.
Good point. I am running hot at the mo so no longer need staking, it was only before when I was running bad that I needed you guys involved

If you ask for staking you must believe that you have a fair chance to win. So when you return the stakes it's not just a question of no longer needing the money it's about wanting to deny the people who showed faith in you when you needed it, a share in the winnings you expect now you don't.