Right, I took "winnings" to mean he won $800 since he said only winnings (not the $800 "freebie chips") could be cashed in and taken home.

It seems by betting on both red and black he negated any chance of coming out ahead--he could only break even (land on red or black) or lose (land on green). With the free chips it would have been better to pick one color or number for a shot at leaving with some money.
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