Suppose a show is budgeted for $120,000 per week (1980's dollars), of which $40,000 is designated as prize money. If a contestant wins $5,000 on a show which doesn't air, the network is still paying $40,000 for the week's prize budget. That money doesn't go back to the network, so the packager can either keep it or pay the contestant. Either way, the money comes from the network.
The main reason everything is kept on the up-and-up in the wake of the quiz scandal is as follows. All four major networks own TV stations and hold broadcast licenses issued by the FCC. The networks control game shows so tightly to avoid challenges to those licenses at renewal time or a cash forfeiture, due to hanky-panky on a game show such as almost happened with Our Little Genius.
In modern times, the FCC levied a forfeiture against a station which didn't disclose that handout video provided by a car manufacturer and used in a news story was provided by the car manufacturer. The FCC felt the station had received a "thing of value" and that the handout video was too much like a commercial, so the station should have disclosed it just like prize suppliers are identified on a game show. The FCC has also levied forfeitures for airing a commercial which contained the EAS sounds as an attention getter. The FCC was on the warpath over that one. At my station our VP of Engineering circulated memos about these things.
In the case of our unaired George Peppard show, I don't recall that anyone won anything.