General Services Administration is an Executive Branch function, so Nancy Pelosi does not officially have authority over what happens in the Capitol Building.
As Speaker of the House, she could formally rescind her invitation - but all that would mean is that she (and the Democrat majority) would not be hosting the event. She has not done that, but if she did, many alternatives are possible. The minority leader could extend the invitation instead, and either host it in the same South wing chamber according to tradition, or perhaps out of respect for the majority, host it in a different chamber.
There is nothing in the constitution that says the House of Representatives needs to host a SOTU address, or that it is subject to an invitation from the Speaker. The Senate could host it, or the House Minority could host it. These formalities are governed by traditions, not laws.
I think the President should tell her he intends to go ahead with the address as planned, and politely ask that if the Democrats are not going to attend, would it be OK if he offered their seats to others to whom he might wish to extend a special invitation?
Let her stew on that...
I agree. He should say he will be there and hopes she will attend. Period