I agree that a buyer , buys something on here for what they are prepared to pay. The problem i see here is not that the seller left the reduction tag on the product ( however if they had removed that i dont think there would be this problem at the moment )

The problem i see in this case is that the seller advertised a RRP and then the buyer found out that the seller actually got the item from a shop at an even lower price. 

To me this is the same that the B&M jeweller shops have been guilty of and prosecuted for. Places like Shiels have sales where they advertise a ring RRP $2000 on sale for $199. People do tend to buy an item if they think they are getting a bargain. If Shiels put down RRP $210 sale price $199 their sales would be no where near what they are because people think they are getting a huge bargain.

The very mention that the items RRP was $49.95 would have been enough to make someone interested in the item paying $15 or $20 or $30 because of the perceived savings. But finding out the retail price the OP paid was nowhere near the RRP is enough to make people upset.

Either show a RRP and dont let the buyer find out the retail price you paid ( remove all tags before sending )

Or dont show a RRP