I think they have only paid it off in a lump sum because of the criticism that, if they can afford to buy a house costing several millions in America, then they can afford to pay this debt first. They obviously had the money to do it all along so should have offered straight away. Apparently, they are also paying rent so they can use it when in this country- whenever that odd day may be!
Personally, I would rather see the cottage go to someone else, perhaps one of the York girls. I don't particularly like either of them very much but both have always been supportive of the Queen and, apart from their often poor taste in clothes, haven't behaved badly or done anything to embarrass the family.
Perhaps M&H might also think about paying some of the costs of their wedding back now too as they had an expensive Royal wedding and they don't want to be Royals any more. Also they need to pay their own security costs.