You do say this earlier in your post (and I don't mean to downplay the risks) but especially if your kitty is young-ish (10 or less) and otherwise healthy, there is no real reason to think surgery wouldn't work. The condition is actually very treatable and almost always is treated successfully when owners can/do pay.Alas, the risk of surgery failing is something that has to be considered with any medical procedure for either humans or animals. It's a gamble, and unfortunately, one can't get a refund if the surgery doesn't work. But also ask yourself if you would be okay with knowing your cat was put to sleep for a treatable condition. I'm not trying to be a jerk when I say that, but I just wouldn't want you to regret not getting him the surgery. I understand about finances, and a thousand dollars is a lot of money for care that might not work. It's a difficult position to be in and I'm sorry you have to deal with it. I hope for the best for you and your kitty.
Good luck Sorry to hear he is peeing blood now.