If she declines to make any statement to police they will still proceed.
If she seeks to change a statment (if she has made one, even if it initially named the flatmate) they will still proceed.
They will not withdraw these charges for any reason. It is NSW police policy not to withdraw domestic violence charges based on the attitude of the victim. Victims notoriously withdraw allegations as a result of emotional / psychological issues relating to domestic abuse.
If she recants the police will seek leave, likely to be granted, to cross-examine her as hostile witness.
She will be extremely vulnerable, as it appears she has already made a demonstrably false statement to police accusing the flatmate. She is apparently a law student and the consequences for her of perjuring herself, or having misled police (arguably even conspired to pervert the course of justice) could be long standing.
Eevn without her evidence assisting police there is a strong circumstantial case against Bird. His initial complaint against the flatmate rpesumably places him in the flat with the victim. It will also be demonstrably untrue (in that the flatmate has a watertight alibi).
There will then be the phone conversations / SMS / which are all consistent with Bird's guilt. In addition there is the potential evidence form neighbours.
Plus, although she sought to assist Bird initially, when she sobers up, and recovers, and contemplates all the risk she is taking to protect someone who appears to have glassed her in the eye, I suspect she will come round to the prosecution way of thinking.
If for any reason he is acquitted, I suspect the police will prepare a brief relating to a pervert the course of justice charge to the DPP. They may do so anyway.
He is in all sorts.