I'm a true outsider about any kind of AI, but I can read between the lines, and after looking at Gebru's letter and Dean's response, it seems as if there's a whole lot of backstory that remains beneath the surface.

Google's grounds for cancelling the story seem flimsy, and if Gebru were the sort of person to fly off the handle over trivialities, she would probably have done so long before now.

My guess (pure speculation) is that Google would prefer for its AI initiatives to be unencumbered by ethical considerations but wants to appear ethically minded in order to head off the various qualms about unrestrained AI from the general public.