A pay cut is a constructive dismissal. You've already effectively been fired with an offer to rehire at another lower paying job. Thanks but no thanks.
Depends what the market is like. I took a pay cut during dot-bomb and there really was very little out there. My compensation did creep back up over time but it did take a long-term hit until I eventually went elsewhere. (Other than low comp, I did enjoy the work for the most part.)
