I did send them an email back and this is their reply.

Dear customer, 

Thanks for getting back to us. 
Yes it is our fault that we did not contact you in time. 
We didnt get the information from our warehouse instantly when the order was transferred from other warehouse as there are so many orders need to handle every day. 
For this inconvenience, we will issue you a refund of $1.5 as compensation. Is that okay for you? 

Thanks for your time and looking forward to your reply. 

If they have so many orders to handle that they can't follow up with buyers I feel that is pretty poor business practice.
I do appreciate the offer of some refund even if I don't completely belive it.
I do NOT want a refund though. I simply want them to be more honest and improve their business practices that I feel are unfair to both buyers and competitors.

I do not want to leave poor FB but I am not happy so I might just not leave FB at all.

Any advise on how I should reply to the message? Like I said I don't want any refund but part of me thinks maybe I should call their bluff just to see if they are being honest.