As Johnny and Ponyboy devour a big meal at the Dairy Queen, Dally explains that Cherry felt responsible for a situation that resulted in Bob's stabbing, so she offered to watch monitor the Socs' preparations for the rumble and to testify that Johnny acted in self-defense.
Ponyboy doesn't let the superficial differences between him and Cherry determine his opinion of her. Instead, he recognizes and admires Cherry's sensitivity and independence of thought and action.
Johnny announces that he thinks he and Ponyboy should turn themselves in to the police. Dally tries to convince him otherwise, saying that he never wants Johnny to become hardened in the way that jail would harden him. Johnny responds that he thinks he has a good chance in a trial since he acted in self-defense, and that he feels guilty for worrying Ponyboy's brothers. Dally agrees to drive the boys back to Tulsa.
The main drive behind Dally's care for Johnny is revealed here: he wants to stop Johnny from growing up to be like him. While Dally himself has lost his innocence and hope for a better life, in a way he can still access those feelings by protecting and preserving them in Johnny.
As they drive past the church where they had been hiding, they see that it's burning. A crowd is standing outside, and a bystander tells them that a school group was having a picnic there. A woman shouts that some of the children are missing inside the church. Suspecting that their discarded cigarette butts may have started the fire, Ponyboy and Johnny dash into the burning building. They find the children and lift them one-by-one out a window, continuing even after Dally runs in shouting that the roof is about to collapse. The roof collapses, just as they save the last child, and Johnny knocks Ponyboy through the window, saving him. Ponyboy hears Johnny scream behind him, but before he can go back Dally smacks him on the back and knocks him unconscious.
Though they are seen by society as misfits and hoodlums for being greasers, Ponyboy and Johnny's first instinct is to take responsibility for the fire they may have caused. They exhibit great heroism by running into the burning building without a second thought. The act of saving the younger children also seems representative of the boys' desire to protect and preserve the innocence of childhood, which they feel slipping away in themselves.
Ponyboy wakes up in an ambulance with Jerry Wood, a teacher and the bystander whom Ponyboy spoke with before rushing into the burning church. Jerry tells him what happened: Dally knocked Ponyboy out while smothering a fire that had caught on Ponyboy's back. Dally then saved Johnny. He adds that Dally is burned but will be fine, while Johnny is in very bad condition. He praises the boys' courage. Ponyboy responds that they're greasers and that Johnny is wanted for murder. Jerry doesn't know the term "greaser" and is surprised by this news about Johnny, but he continues to try to comfort Ponyboy as they head toward the hospital.
Jerry's praise for the boys' heroic acts and his complete ignorance about what a greaser is reveals the meaninglessness of the greaser identity to the world outside Tulsa. Jerry helps Ponyboy see that it is the boys' courageous acts that speak for them, not their hair, group affiliation, or social class. Notice that while Dally's actions were also heroic, he acted only to save the members of his gang, while Johnny and Ponyboy saved people they didn't even know.
Ponyboy suffered only minor burns, and is soon discharged from the hospital. He sits in the waiting room with Jerry, worrying about Dally and Johnny, and finds himself telling Jerry the story of Bob's murder. Jerry agrees that Johnny acted in self-defense and reassures him that the judge will also take into account the boys' actions at the fire.
Jerry continues to treat Ponyboy with respect and kindness, despite learning of the boys' role in Bob's death. His treatment of Ponyboy is totally unaffected by the stereotypes that dominate the greasers' life on the streets.
Soon Sodapop and Darry arrive. Ponyboy and Soda hug. Darry stands apart, and Ponyboy sees that Darry is crying. Suddenly Ponyboy understands that Darry's harsh treatment of him results from his love and his concern for Ponyboy's welfare. Ponyboy hugs Darry and apologizes to him, and has the feeling that everything will be okay once he returns home.