If the council chooses to make an ordinance amending the charter subject to a referendum, may it change its mind and cancel the referendum?

Probably, although the matter is not entirely clear. The courts have permitted repeal of other sorts of ordinances or resolutions before they become effective, and there is nothing in the charter change statute that suggests a different rule for ordinances that amend the city's charter. If a council were to repeal a referendum resolution, however, it would certainly need to publish a new notice of passage of the ordinance itself, since the statute gives citizens 30 days from that notice to circulate petitions to force a referendum.