How would you write to your in-class team, that you are going to drop the class, leaving no hard feelings?

Your suggestion looks fine. I would consider making an offer to bring them up to speed on anything you have been working on that could help them out.

I think that your suggestion, like what Scott thought, looks perfectly fine, but you should make a few edits.

This is what I think you should send.

Hello guys,
I hope you are having a good weekend,
I’m writing to you to let you know that unfortunately, for personal reasons, I have to drop out of this class. I have sent an email to the professor, so he will be aware of it very soon. (If you were working on something for the project, courtesy Scott) I was working on 'blah' and will send you the attachments so that you can use my work. I hope you understand, and I wish you guys the best on the project. Sincerely,

Some points I like about your email

• You were polite
  
• In it you told the team why you had to leave
  
• And you wished them good luck/best

Good Luck!

All you need to do is tell them politely, whatever you say is fine, include "I'm sorry" or some similar expression of regret, what you wrote is fine.

More importantly, tell them now. Don't wait or spend time crafting the perfect message. The more heads up you give them the less impact you have on them. It's much more rude to wait writing the perfect email than it would be to send a poorly written email on time.