it may be only his shame in public. But I think he regrets killing his own daughter .

In regard to Otranto, I think he knows he's ruined. Even if his grief wore off and he decided to stage a coup, he'd need arms and men and who'd want to re-establish a feared tyrant ?

Many people saw the ghost declare Theodore as the true heir and I think many people would be glad to believe it just to have a new prince !
If Manfred proved troublesome, he wouldn't be the first prince kept prisoner in a convent.
Or maybe executed to prevent civil war.
However, I doubt Otranto wil hear more of Manfred.