Does someone retain their promotion points after having a flagged removed as favorable?

Points earned are points staying. What changes is your ability to promote (as in, Promotable status).

Having your flag removed does not mean it was removed favorably. Unless you were found - not at fault - meanimg you should have never been flagged, it's not favorable.

Here are some examples of not at fault:
You were charged with something and it was determined to be completely unfounded.
You failed ABCP but they realized they measured incorrectly
You were accused of something but completely cleared of it.

Here are examples of not closed favorably:
You were fat and now you're not.
You failed apft and now you passed.
You received UCMJ and it's over now.
You were flagged for an investigation but there wasn't enough to charge you with.

IMHO (and previous experience), the only thing which was ‘flagged’ was your ability to be prominent. You shouldn’t lose points unless your PFT or weapons qualification goes down. I would strongly recommend you check with S1 because ‘paperwork’ necessary to remove the flag has to get to them and then, if you made the score, they should issue promotion orders. Since the ‘incident’ was resolved in your favor, your DOR can be backdated. You would have to apply for the backpay from the date of your orders to the date the orders should have become effective (without the flag)