I'm a bit confused here, because you seem to realize the Halt Order did indeed come before the decision to fight on was made, but then seem to not understand what a complete loss of the BEF would entail to that event chain. Further, I think you fail to realize how precarious the situation of the BEF was by that point, in that forward German units had reached the Aa Canal and were thus in position to bag the BEF along with significant Allied units. Whatever the cabinet may have thought, the complete loss of the BEF would alone shake them enough, but it's not them that would be decisive; it would be the public. Far from the morale victory of successfully evacuating the BEF, ATL you'd have it's complete destruction. It's not hard to imagine the political ramifications of such.