To give you some answer to your question about what to do... and at least add a little value, and let you know we have your side...

Just checked some advice from UK eBay site forums, people generally 1) Require returned goods at buyer's expense 2) Good sellers pay the return shipping 3) You can waive the return requirement if you want to 4) After it's returned to you and you have it, refund only via the Paypal transaction they paid by.