I totally agree with twentynine. I'm sorry, but I don't agree with fighting over a few hundred dollars (and I'm a student, so I know how much money that can be). Too much stress and heartache. Sometimes, bullies get their way. It can be a hard pill to swallow, but think of the big picture. What is your sanity worth? Is doing battle with this guy really worth the stress and headache? Ultimately it doesn't matter who is right and who is wrong. You know that old saying about what goes around coming around. It is very true. There is another one that is very true- let go and let God. Lots of truth there even for the non-religious. You sometimes have to trust that someone will "get theirs" even if they get you. Does that make sense?
For me personally, this would not be worth the drama. At one point in my life, it would have been, but not now. Life is too short to get caught up in all this heartache. Give the guy his money back and tell him to never contact you again. Just be done with it and move on.