I asked him if he thought he could win and I told him maybe.
Why do you think he only has a small chance to win?
He's not very good and I don't want to hurt his feelings.
You weren't sure of his abilities, so you were just being honest about it all which is good. You are a good sport for letting past differences aside and letting him have a chance. You don't need any bad blood between you two.
He seemed to be fine with my response, he didn't take it too personally.
It's best not to overinflate his ego if he's really not very good. Trying not to hurt his feelings was kind and generous of you.