Amazon and Google are certainly within their rights to refuse this. Allowing domain fronting is likely to put quite a lot of their money at risk, so this outcome is unsurprising, but it's still the less ethical one.
This might be the only possible outcome given a corporation's legal responsibilities to its shareholders etc, I don't know all that well enough, but I think it's still justified to lower my opinion of Google and Amazon because of this.
I realized I glossed over the fact that this would put other AWS/GAE customers's money at risk too. This complicates matters somewhat, and some (I believe a negligible number of) customers might switch to an unblocked competitor.
Personally this weakens my view a little, but is not enough to change it substantially.
Despite the use case for censorship circumvention, many malware command and control bots use domain fronting to bypass corporate web filters that otherwise might block their traffic. CloudFlare, being a security-focused CDN, most definitely does not want to help enable malware authors to bypass security.
Where do you get that from? The Russian government blocked lots of AWS and Google IPs, and had no problem keeping them blocked until they agreed to stop allowing this, which was the same thing Telegram was using. And it doesn't appear that they cared about the "huge financial cost".
This might be the only possible outcome given a corporation's legal responsibilities to its shareholders etc, I don't know all that well enough, but I think it's still justified to lower my opinion of Google and Amazon because of this.