In your second screenshot, it looks like you don't have a rule selected for your "Cancel Timed Actions" action. If this is your actual rule and not just a re-creation you made for demonstration purposes, I'd assume that would be the problem.
PS - Your second rule would do the same if your trigger was "off" instead of "changed," then you would only need the time conditional and not the "off" in the condition. What you have now is totally fine and leaves you room to expand more in the future (if you want to respond to it turning on) but is otherwise a couple more clicks than you need.
PPS - Related to that, another thing to consider is that this second rule's actions might not run if the switch was already off, but since it's the same light being controlled by the first rule (which should have it on), I'm guessing that wouldn't happen. In case you ever change this to a "virtual 'stop that other automation'" switch instead, you'd want to make sure the state truly gets changed so the RM trigger will fire.