I would like to share ‘my view point’ on returning the funds as well as the current talks that read a bit like ‘CC failure/disaster’.
First, regarding returning funds the the OC, I am rather neutral about it. I would argue to stay objective and be pragmatic, not overly expecting, emotional, or desillusioned.
When I put myself as candidate for the CC there were a number of reasons:
- I wanted to help facilitate community projects, providing funding, information and guidance where needed.
I think that as CC that is exactly what we did. We listened to request from the community and made sure funding was available for projects, feature and policies requested by the community. Does that mean every penny was well spend and that nothing went wrong? Absolutely not. But that was never the point of the CC or the community fund. To my understanding the aim of the fund and the CC was to help facilitate community projects where needed, not to drive them. Examples are the Grin miners and paying in Grin. In retrospect it was not the most effective ways to spend funds, but that does not matter, it was what the community was asking for at that time and as such it was spend in line with the objectives of the CC funds. Other examples are creating bounties for a Telegram bot - just yesterday I found someone already created a Grin Telegram & Keybase bot! Results are beside the point, there was a demand from the community and we made sure a bounty was created. Similar for funding for the Python cffi secp256k1-zkp wrapper. My point is, that it neither is or ever was is the job of the CC to make sure something is a success, whether that is the project at large or any small projects. It is the CC’s job to exist, listen, weight valid arguments and provide funding where needed, not leadership in the traditional meaning. Many things were experiments, like paying in Grin or having miners so we can do Grinonomics
- To take away pressure and community attention from developers and the OC.
I noticed in the past that the combination of development and governance for OC members and developers was basically a major energy drain leading to many good people leaving the project. Developers like to develop and discuss technology from a technocratic perspective and in general do not like to continuously be involved in politics and discussions that are often not supported by solid arguments, but by emotion, e.g. why no moon yet, why did you not develop XYZ just because I need it or because some random other crypto projects has done so? I think the existence of the CC took away some of the burden from developers so they had more space for development. Unfortunately, many developers had already left the house. At that time and @davidtavarez took a large share of dealing with complains, disgruntlement and other CC tasks, like the mining farm, that honestly are not and should not be the task of the CC and caused a burden and energy drain on normal governance and worse on the time David had for developing. Still regardless the lack of developers, I think we created some breathing room for the OC, developers and old community members so they had more time to go back to doing the things they liked to do instead of getting so drained they would leave the project like before.
- Create a fun and positive community experience
I think we had fun with meme contests and in general changed the forum and community to a more fun place to be part of and made the project more fun to contribute to. Before the CC there was a lot of toxicity. That does not mean there were no tough discussions or less fun times, but overal I think the existence of the CC helped to create a more positive and productive environment. At least, to me it felt that way 
.
Regardless on whether we return the funds to the OC, add new members to the CC or do something like merging the councils to some extend, I think there will always be too high expectations, disappointments and in some cases, funds will be spend that in retrospect could have been better spend. I think that is all part of the game. Returning the funds would increase the already abundant funds of the OC but would not in any way that I can see lead to a positive change in governance.
I do not know the mind of the original donor, but I do not think he/she expected everything in the project to always go perfect or every penny to be spend perfectly. I think the main objective was to take away finance as an obstacle for the project, and the funds have succeeded in doing that. I love grassroots projects and free development but I think we should be pragmatic and realistic at the same time. Not everyone can afford to contribute freely. It is better to have multiple options (funded and free contributions), instead of only a single option (burning funds or giving them back to the donor and only free contributions).
This is in short my opinion/view of the topic. Again, I am rather neutral on whether we give back the funds to the OC or not, but I do not think it is realistic to expect that doing so would lead to any improvements since the OC already has enough funding and will most likely not ever go back to the way it was before, which IMO was still the best time of Grin governance.