Problem is if he does that, Putin might actually bring something to the table to call Biden's bluff and then Biden will look even worse for backing down afterwards. After all he's sure to win if the debate actually happens, Biden is extremely weak on speaking. As is this response shut things down entirely and lets him save face by claiming Putin's not worth his time, which is the only, well not exactly winning move but less losing move.
Oh I'm not saying it's a good thing to be sure, it did make the US look weaker. Biden is between a rock and a hard place there. My point is more that between running away, and having Biden try to debate Putin in front of the whole world, running away is the better option.