The players sound like spoiled children. Instead of working within your limits (all of which are good reasons to stick to the core book), they wanted their way regardless of the extra burden it put on you. I feel bad about for the player that asked you to GM, they probably feel like crud for inadvertently setting you up for that fall.
The fact that they didn't invite you to the other game is pretty low. If that's the level of maturity these "adults" possess, then good riddance. What kind of computer do you have? RPG Geek has a lot of folk up for VoIP games that are plenty chill and act like adults.
He gave them an ultimatum. Two options: Core Only ("My way") or Find a New GM ("The Highway").
There is nothing spoiled or immature about taking 1 of 2 options presented.
If anything, presenting an ultimatum and then being surprised when people take one of the options you've provided (the one you didn't want, but provided anyway because you were SO SURE people would never leave you) is the immature one.
Note, I'm not saying the OP here was immature. Just saying that trying to assign blame in this scenario can go either way (but likely should go neither). The group wanted one thing. He wanted another. The groups went their separate ways, with little fuss that I can see.
Best case scenario this side of a compromise as near as I can tell.
Ok, calling them spoiled was a bit too strong, but you can't say they were mature about it. He was asked to run the game, he gave conditions for his game, they decline, but instead of just moving with a different GM, they "fail" to invite the OP to the new game because he didn't give them everything they wanted.
"You didn't give me what I want so I want play with you anymore" is the reaction of 1st graders, not adults.