If you choose option 1 (report unpaid item), you can send a message to your buyer saying something like, "Dear [buyer], as you have decided not to proceed with completing your purchase, an unpaid item claim has been opened. You do not need to do anything, as this will automatically close in 4 days and you will not be required to pay. Best regards, [your name]." You must close the case to complete this process - this can be done after four days have passed from the time that you opened the case.
If you choose option 2 (cancellation request), the buyer must respond to your request within 8 days. If the buyer doesn't respond, you will have to wait out the 8 days (I believe that's how long it takes) before being able to close the request and before the process of being able to request your final value fees can be undertaken if it's not done automatically (as appears often to be the case). If the buyer doesn't agree to cancel the request (even if this is accidentally clicking onto the wrong button), then you are stuck with paying the final value fees as eBay will deem the item to be sold. (Sellers, please correct these details if needed!)
