How has Jimmy changed in 'A Retrieved Reformation'?

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Jimmy's change was triggered by his falling in love at first sight with the beautiful and highly respectable Annabel Adams. It should be noted, however, that he was already beginning to realize that a life of crime is always a mistake. It means that the criminal becomes too well known to law enforcement officers, such as Ben Price. Judges impose harsher sentences. It is easier to get caught and harder to get out. 

He had served nearly ten months of a four year sentence. He had expected to stay only about three months, at the longest.

He also realizes that he is getting to be too well known as the best safecracker in the business. This is brought home to him when the warden seems to know all about him and when his old pal Mike Dolan asks:

“Got anything on?” 

Obviously too many people know about him and too many are talking about him. So Jimmy decides to move all the way to Arkansas, establish a business as a "front," and start operating in a virgin territory. But by chance he sees and falls in love with Annabel Adams. 

Jimmy Valentine looked into her eyes, forgot what he was, and became another man

He "became another man," but he was unconsciously preparing to make a radical change before that chance encounter. Annabel is a "catalyst' rather than a "cause" of his reformation. He knows he cannot win her love and remain a criminal. His experience in the shoe shop in prison gives him the idea of opening a shoe shop in Elmore, Arkansas. He is successful because of his sharp mind and winning personality. O. Henry is making the point that a man who has the talent to be a successful criminal can use the same talent to be successful if he goes straight.

In the end, Jimmy's future looks bright. He is a successful and respected citizen, engaged to marry a beautiful girl, accepted by her family and all their friends, on his way to becoming a family man, homeowner, churchgoer, and pillar of the community. He has changed his name to Ralph Spencer in order to put "Jimmy Valentine" well behind him.The change that has taken place in the old Jimmy Valentine is spelled out in the letter he writes a friend to whom he is bequeathing his set of custom-designed and custom-made safecracking tools.

Say, Billy, I've quit the old business—a year ago. I've got a nice store. I'm making an honest living, and I'm going to marry the finest girl on earth two weeks from now. It's the only life, Billy—the straight one. I wouldn't touch a dollar of another man's money now for a million. After I get married I'm going to sell out and go West, where there won't be so much danger of having old scores brought up against me. I tell you, Billy, she's an angel. She believes in me; and I wouldn't do another crooked thing for the whole world. 

For a few tense moments when Ben Price shows up at the bank, it looks as if Jimmy's dreams are  about to be smashed to ruins. But his good deed in saving the life of the little girl accidentally locked in the bank vault, makes such an impression on his nemesis that he is allowed to "retrieve" his reformation and go ahead with his idyllic new life.

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