Home game disagreement...thoughts on the correct ruling..

I was playing a home .25/50 NL, $10.00 buy in this weekend. Generally just a friendly game amongst friends. The following dispute came up, I think I know the answer, but wanted to get some impartial input.

Background: At 1:45 a.m. player A and his ride announce that they are leaving at 2:00 a.m.

2:00 a.m. rolls around and player A and his ride cash out, each having .75 left which we couldn't make change for out of the pot as it was only 1.00 bills and up. As this amount was more than the big blind, and player A and his ride were next up to be big blind and first to act, each say that they will go all in, pre flop...no grumbling from the table so hand is delt out...player A wins after floping top pair...going 4X up as there were two callers....he cashes out again...leaving .50. Then came the disagreement.

Player X then says, "that's BS, you can't do that at a casino"

Player A says, "yeah you could...its your money, you can cash out anytime you want."

Player X says..."no, in NL any chips you have are to remain in play at all times until you leave. You cannot take any chips out of play and still continue to play."

There was further disagreement and wackiness ensured.

Who was right? I'd agree with player X if player A tried to take chips off the table in the middle of the hand, but I've always thought that if you wern't in a hand you can add/or subtract any amount you want to you $$ in play.

Thoughts?