I would not refund this one yet. Firstly if they won't give you a photo of the damage it could be a scam. Also don't refund to a different way. If the item is returned damaged - no refund at all. It must be returned in the same condition it went in to get a refund. As you have photo proof of no damage you would be able to prove this to paypal. Tell them this and you probably won't hear from them again.