Is it ethical to withdraw a conference long version paper after being accepted as a short paper? Is it ethical to withdraw a conference long version paper after being accepted as a short paper?

Just recently we got an accepted short paper at a decent Computer Science conference. However, we submitted as a long paper and there is not a single instruction cautioning us that the PC could demote the paper.
Yes.

Publication requires both the consent of the publisher (via the editor or program committee) and the consent of the authors.  If you do not consent to publish under the conditions imposed by the publisher, you can just say no.