Since Jenred never formally abdicated, technically (or legally, rather) he is still the King of Arcaea and Velax only the Regent. There is not really a good example of this happening in the Middle Ages but if I had to speculate, I'd say that no King of Arcaea who hadn't formally lost the title would ever accept losing the title unless he was willing to abdicate it.
If he did not abdicate and return, what would probably happen socially (at least from the 'kinda sorta actually medieval' POV) is that he would retain formal address, e.g. Your Grace, but nobody who values their head would call him 'King Jenred.'
They would also probably avoid Your Majesty. Your Grace is easy because it's also a generic 'you da boss' address used for Dukes as well as Kings. 'Your Majesty' is more renaissance than Medieval and would probably be avoided even if it had been.
Interestingly, however, Jenred was never crowned Emperor, so even if he has a claim on the Kingdom, he doesn't have a claim on the Empire. This is one reason that the HRE liked having the Pope crown its Emperors - it was a pain in the ass when you had an ornery pope but it kept pretenders in a solidly illegitimate stance.
All of this is pretty tough to translate to BM since Jenred would have to be an idiot to come back from the dead and declare himself King and Velax not-King, at least given the number of magnates who barely have any idea who Jenred is. A historical setting would have lots of families (rather than just individuals) loyal to the House of Bedwyr and there would also be less turnover in lordships than there is in BM. So a 'what would really happen' question is easily misleading.
Summary: Jenred should retain Kingliness but avoid the word 'King' like the plague.
