You're allowed to charge for postage and handling and it doesn't have to be to the exact cent that Australia Post charges.
I wouldn't do a thing as you paid for brown paper and bubble wrap.
If the buyer complains in feedback (they probably won't) just reply that $14.95 was the Australia Post charge but you supplied all the extra materials, such as bubble wrap.
If you feel you must refund anything, only refund for a couple of dollars & explain about the extra materials you paid for.
But I know how you feel in that some buyers never consider that, they expect postage price to match pretty much to the cent.
If you decide to list with shipping included in the total cost, that would save this sort of dilemma as buyers would never know the actual postage component.
I suppose the negative side is it bumps up the price.
However, from what I have observed with friends etc, they love the free postage or should I say, the at a glance aspect, where the listed price is the total price.
I have to admit even I get like that if I see something, glance down and think, oh no, it's an extra $11.50 with postage, or whatever.
It's not as if you mention combined postage in your listings, so that's not a drawcard.
I'd probably go with 'free postage', given the nature of your items, but I no longer sell so I may not be the best guide.
Maybe try free postage on more of your items and see how it goes.
