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If the condition were the issue you could have asked to have that remedied even at this late date.
Most sellers would have come to an agreeable resolution rather than see the deal fall apart.
The previous comments are right on. But what's really interesting is that if your motivation was to stay in this sale then you'd look further into this repair condition rather than wanting to back out of the transaction. There's likely a sole plate underneath that register and new drywall can be put into place and screwed into that plate. You might be talking about $10 in materials. It's hard to tell what sort of heat that is, but there might be a hole drilled in the floor or wall to allow either wiring or pipes to go through. It's likely that some air penetration has ocurred in that area.
What you really need to be doing is to figure out how to repair it rather than trying to back out of your contract.
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