"Children as young as nine were left devastated by the actions of this man, whose fraudulent plan could never succeed," police said in a statement.
Stephen Moonesamy, 35, was arrested after approaching three dance schools in the central city of Northampton and recruiting children between the ages of nine and 18 to perform at the closing ceremony on August 12.
Prosecutors said he charged each child for taking part and built up an elaborate operation by training the dancers, securing equipment and gaining sponsorship from local companies.
"His project was pure fantasy - based on a lie that grew larger and larger over time, which he added to by his repeated fraudulent actions," the Crown Prosecution Service said.
"However, he does not appear to have made a large personal gain from his web of lies."