IPhone – My iPhone X was stolen. Will the iCloud be logged out if the person resets the iPhone using the phone’s password

As soon as the device connects to the internet, Apple's servers will send the erase message to the phone. I have seen this happen three weeks after the message was sent and the effect was nearly immediate.

I don't know of any way to recall the erase message once you've sent it, and you should receive an email if the device ever registers and the erase message is sent.

All the things you did after the erase request are moot since if the phone never checks in, you can't really stop the erase and if it does ever check in, it will get erased and self remove from your list of devices.

You might open a support ticket with Apple to be sure the email will send if you erase the device (I haven't actually tested that sequence), but common sense says you might expect the email if the erase ever gets issued.

If your iPhone is stolen and has FindMyiPhone turned on the thief would need your iCloud password in order to disable it. The thief could wipe the phone by putting it into DFU mode, but upon trying to access the phone they would run into the problem of still having to input the iCloud password into the phone so that they are able to access it as it is still registered in Apple's data base as being connected to your account.

So yes the phone can be made to go back to its original state by recovery, but no it will not be able to be activated as long as they do not have your iCloud password.