It's a pretty terrible dilemma for the Tories. The D-day thing really has to be the last straw for Sunak, to the extent that I suspect winning his own seat is looking a bit dodgy. But really they have two terrible alternatives - going to the country with a leader who is coming over as badly as this, or going to the country in a state of chaos with, presumably, Dowden as interim leader and an electorate knowing that all they have to offer is the prospect of yet another PM solely elected by Conservative Party members. But, then again, even if by some miracle Sunak did win the chances of him lasting for any length of time as PM are pretty minimal, so we're looking at another leadership election anyway.
I suspect they're concluding that the reality is they're going to lose anyway so they might as well keep Sunak so as to have a scapegoat.