You can always withdraw an inland application if your timeline is taking too long and you want to apply outland . . . of if the sponsorship was refused and you needed to reapply from outside because of the inability to remain in Canada. The criteria for being approved is the same, whether inland or outland, so they're not necessarily going to look unfavorably on an application just because you had an inland ap in process and withdrew it - however, if the application was refused for any reason you would have to correct that problem or you'd end up with the same result on an outland ap also.
No, they do not refund either the $475 applicant fee or the $75 sponsorship fee. They would refund the $490 RPRF though.