Regardless,to dig in and insist on keeping the item and insist on partial refund is not an option that has been offered, nor a remedy that the dispute resolution process will provide.

As with real life, from time to time goods are sold on eBay that may have faults - and the remedy under law is a sellers discretion to repair, replace or refund. 

I urge you to consider your own feedback record as well prior to leaving negative for any seller as your remarks appear on your public record, and with 4 feedback only it ain't going to do your feedback history any favours either.

In the situation at hand, the seller may leave a follow up comment to clarify that you would not accept a refund and insisted on a partial refund and it kinda would likely make you unpopular.