Are you suggesting however that "The flight crew acknowledged the clearance and responded that they would cancel IFR “in just a couple of minutes.”" meant the crew was informing the tower that they would transition to VFR? That seems... unlikely. I'm reading the paraphrasing here as towards declining to cancel the ILS approach they previously requested because it doesn't particularly make sense to me otherwise.
Which is really back to "this preliminary report doesn't, and doesn't even attempt to, assign blame or contain sufficient facts to do so".
It's very common to cancel IFR in the air, especially for late night operations to non-towered airports. (At an airport with an operating tower, they will close your IFR flight when you land.) At a non-towered airport, you have to either call on the phone or use a radio relay to close your flight plan, which can be a pain, so in benign conditions it's very common to cancel IFR in the air where you have line of sight [meaning good comms] to the ARTCC radio transceiver and avoid the hassle of bad cell phone coverage and/or no radio contact possible on the ground. (There is no radio relay at Ruidoso; the nearest RCAG is at Roswell, 50+ nm away with terrain in between.)
ZAB ARTCC's transmission that "they could cancel IFR in the air above 9,000 ft msl" tells the crew "once you get below 9000 MSL, you probably won't be able to talk to us on the radio".
When the crew said "we'll cancel IFR in a couple minutes", that's also common. It means "we're going to stay IFR and fly the visual until we're a little closer and landing is reasonably assured."