The problem is that if that provision were actually enforced, kickstarter would be of much less use to those people it was originally conceived of to help. If you are a small independent games company, film maker, or musician, the threat of failing to complete your project (e.g. it was too ambitious, you set your funding goal too low, you run into legal issues you hadn't anticipated, etc.) and being required to pay back tens of thousands of dollars you have already spent is enough disincentive to not use kickstarter in the first place.
In other words, if kickstarter campaigns have to repay backers if they fail, kickstarter becomes radically less useful and interesting as a proposition.
They have to fulfill the rewards it says. Which really means that you shouldn't promise a version of your product if you can't deliver it. Rather it might be better to make the rewards things that are easy to deliver such as shirts, stickers, etc... Definitely some projects like Ouya that have promised a console will technically have to refund people potentially millions of dollars if they can't ship the device.
>will technically have to refund people potentially millions of dollars //
Presumably OUYA is a company with some limitation of liability for the owners, I don't know much about USA company formation but it seems that the company would fold and there would no longer be a legal entity to hold to account. IFF this is the case then "technically" they won't have to refund anyone beyond what liquidation of the company requires.
This is where someone with knowledge of company law steps in and corrects me ...
In other words, if kickstarter campaigns have to repay backers if they fail, kickstarter becomes radically less useful and interesting as a proposition.