Is it possible to shrink down a wheel? I have a tire 6581 which is stretched to the point it doesn't fit perfectly with the balloon designated for it, at one place it is kinda popped out. It is caused by my stretching it when I was younger for the sheer curiosity how much it can stand. Is there any way to undo this stretching and make the tire once again fit perfectly?
You won't be able to make it fit perfectly again. If plastic is stretched over a certain point it is irreversibly damaged.

But you can try to heat it a little to shrink the wheel overall. But it's not guaranteed to work. If you use a lighter you can affect a smaller area but be sure not to burn your part.