I think the reason Hitler gave up the SA was because the Army was very unhappy with those guys... and Hitler needed the army to become the absolute ruler that he became...
That, and some of their more disgusting passtimes.
The SA was extremely left wing, compared to Hitler, many SA members were former members of the Communist Party, and Rohm advocated socialism.
The business leaders, whom Hitler needed, would not support him as long as his party was full of socialists, who wanted their blood.
So Hitler made the deal, and the businessmen gave their support to the Nazis, once the SA were wiped out.
The SA was also loaded up with thuggish homosexuals — not the sort of friends that a head of state can afford.
The SA wanted to become the national army. Hitler was no dummy. He stuck with the professionals, made the Army Officers swear a loyalty oath personally to him and removed the risk of a coup.