It rather depends on the terms of your Returns Policy as described in your sales listing for the item.

When I list items I say that I will agree to a return and refund (or as in this case, a cancellation of the sale) if there was a mistake in the listing or the item was somehow misrepresented.

However, if the winning bidder just simply misread your accurate description in the listing, that in my book, is not really grounds for a cancellation of her purchase from you.

Having said all that, if you refuse to cancel the listing and make it known to the buyer that you still expect payment, you run the risk of receiving negative feedback from them, despite the fact that ebay describe sales transactions as 'binding contracts' that should be honoured by both buyers and sellers.

You do of course have the option if you wish to continue with the transaction and pursue payment from this buyer, of waiting to see whether they decide to pay within the time you have allowed for payment and if they don't, opening an Unpaid Item Case. Again, despite your right to do this, such a course of action could attract negative feedback.

I guarantee that if you receive neg feedback in this situation, ebay will not see that as grounds for removing the feedback.

Sellers are a little over a barrel with bad buyer behaviour. We do not receive adequate support from ebay in my opinion.

Hope this has been helpful.