That is so easy I'm surprised you needed to ask.
At that height/orbital time will be slowed therefore the day is longer and there is more time to to get around the Earth and time to untangle the string before it pulls them off course.
I don't think it's quite that easy...

First, the string doesn't pile up to need 'untangling'... Remember it stays taut because of cf pulling on it. Holding the satellite straight above its mooring at the equator... And for the satellite the day is not longer... Things are normal to them. Twenty four hours in a day according to their clocks and bodies... They may have a higher velocity than earth's surface but they don't care... It's just enough so they can complete one rotation in the same period the earth does one rotation... And their clocks would be recording 24 hours to that rotation *without* time slowing...
But something IS slowing the clocks physically and the passengers mentally.., to some slower amount. Whatever that amount, the satellite is in the same time dilation field.., so it too is being slowed physically. Everything is being slowed the very same amount, including their velocity... Because they can't cover the same distance they would if they don't have the required time. So all of this happens while the passengers record the ship as still doing the higher velocity. They ARE running slower but they don't know it. If they WERE to try to go higher for more velocity, time would slow even more for them. They never quite get to where they're gonig.... Because that seems to be what relativity is all about., right.?
Their atomic clocks are running just fine. So time is right on time for them... It matches their body calls for lunch and sleep just fine. But they can actually SEE the earth moving faster than they can move to catch up... That's what time dilation is all about, right..? Some physical things move slower (or faster) depending on it... Else one could look straight down and see the same spot on earth all the time... Would they not..?
They always considering themselves to be right on time... And indeed they are. As we do here on earth... Who's right..? Both are right... What happens to the string..?

Btw.., since they are truly slowed in a real way, in 'time' people say, it would give them less time to get around the earth. So that's in fact why the earth would keep creeping faster ahead of them. I'm not sure where you were getting their 'extra' time from.
They are looking at an earth rotating faster than they can keep up to it... They are *seeing* the earth move faster with their eyes too... Because it IS moving faster than they are. According to the current theory... It is covering more ground than they are. Time dilation does that, they say. Sooooo, is the string now supposed to prevent that..?
Actually.., and I am totally convinced..., because I know it happens... There ARE geo sync satellites...

And while they do run physically slower than they would without 'time dilation' or whatever all around them.., they really don't separate distance wise. In fact.., and in my theory too...
That is because it is NOT time that's going slower in one area than another... So they don't physically move at different speeds in relation to each other.
Velocity causes their aging.., but it doesn't tie time into itself.., so it can't affect itself... Velocity does not change, whether time exists or not..
But the objects do AGE at different physical speeds while staying in place. They could stay tied together forever, and the passenger in the satellite would stay young and able to look down on that one spot on earth forever... But over many thousands of orbits of the sun he would stay physically connected with no change of position. He would perhaps see the jungle give way to dessert.., and perhaps the earth splitting apart to form a new sea..... Or see earth covered with a soot cloud from an asteroid hit.., for 50-100 years.., killing off most of what lives under it..
The passenger would be running in low gear, but he wouldn't realize it.. His day would be full. He would just be watching something that was going through a very speedy evolution below.
All based on a much higher than likely 'amount' of relativity for sure.., but only for emphasis...
IMHO it's the answer that has all the answers... They don't move apart because it is gravity that controls aging.., but it doesn't do a thing to time itself... Time isn't time being warped and bent as the current thought implies...
So you'll probably need more than a couple of lines to explain how time dilation does it..?
Can you explain it using time dilation..? Keep everything relative now. And I hope you can.