If you had followed the return steps properly you may not have had this issue. You did not need to contact Ebay so soon.

When you go to through the Return process - where the step is to issue a label - there is a drop down list which says "cannot issue label due to buyers location" (can't remember the exact words).

Once you have finished the rest of the return process, the buyer would have received a message to send the item back to you.

They would also have had to upload tracking in order to satisfy the return requirements.

Half the time the buyer doesn't even do this and the return times out after a while.

Until you get that item back, you don't refund.

If it's not too late, start the Return process as I mentioned above.