[guided]The point of this step is to avoid using the estimates at the boundary of $B(0,r)$. We work with a smaller radius $\rho<r$, so the whole closed sphere $\{x\in \mathbb{R}^n: |x|=\rho\}$ lies inside the open ball $B(0,r)$ where the hypotheses are valid.
Assume, for contradiction, that the solution leaves $B(0,\rho)$. Because $x:[0,T_{\max})\to D$ is continuous and starts at $|x_0|<\rho$, there is a first time at which it reaches the sphere $|x|=\rho$. Define
\begin{align*}
\tau := \inf\{t \in [0,T_{\max}) : |x(t)|=\rho\}.
\end{align*}
If this set is nonempty, then $\tau>0$, $|x(t)|<\rho$ for every $0\leq t<\tau$, and $|x(\tau)|=\rho$.
For each $t\in[0,\tau)$, the point $x(t)$ belongs to $B(0,\rho)$, hence also to $B(0,r)$. Therefore the Lyapunov derivative estimate applies along the trajectory. Since $V\in C^1(D;\mathbb{R})$ and $x$ is differentiable, the chain rule gives
\begin{align*}
\frac{d}{dt}V(x(t)) = \nabla V(x(t))\cdot \dot{x}(t).
\end{align*}
Using the differential equation $\dot{x}(t)=f(x(t))$, this becomes
\begin{align*}
\frac{d}{dt}V(x(t)) = \nabla V(x(t))\cdot f(x(t)).
\end{align*}
The hypothesis on the Lie derivative of $V$ along $f$ gives
\begin{align*}
\frac{d}{dt}V(x(t)) \leq -c_3 |x(t)|^2.
\end{align*}
Since $c_3>0$ and $|x(t)|^2\geq 0$, we obtain
\begin{align*}
\frac{d}{dt}V(x(t)) \leq 0.
\end{align*}
Thus $V(x(t))$ cannot increase before the first exit time. Passing to $t=\tau$ by continuity of $V\circ x$ gives
\begin{align*}
V(x(\tau)) \leq V(x_0).
\end{align*}
From the choice of $\delta$ and the upper quadratic bound at $x_0$, we already know
\begin{align*}
V(x_0) < c_1\rho^2.
\end{align*}
Therefore
\begin{align*}
V(x(\tau)) < c_1\rho^2.
\end{align*}
On the other hand, at the first exit time we have $|x(\tau)|=\rho$. Since $\rho<r$, the lower quadratic bound is valid at $x(\tau)$, and it gives
\begin{align*}
V(x(\tau)) \geq c_1 |x(\tau)|^2 = c_1\rho^2.
\end{align*}
The two inequalities for $V(x(\tau))$ are incompatible. Hence the assumed exit time cannot exist, and the trajectory remains in $B(0,\rho)$ for its entire interval of existence.[/guided]