Made the decision, or couldn't? A Daedroth that chooses not to meddle with mortals is pretty unusual (perhaps I should say a Padomaic rather than Daedroth, Jyggalag seems to have no agency or desire for it in Mundus, but he is arguably Anuic, and only counted as one of the Daedra by the strict Altmer meaning of the word).
Let's not get into definitions to much here, it could take over the entire thread...
anyway made the decision is probably not the right way to describe it. It's possible that he wasn't able to come back because some overlord held him back, it's possible he had no desire because of what happened last time, it's possible that he returned a million times but never identified himself or the name just never meant anything again, it's possible that this was just a made up story.
Regardless of reasons and options, he if the story is real, is not dead. Daedra after all can not die. Though technically he could be stuck in a piece of Daedric armor somewhere.