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Refunds
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You funded the payment to the seller using bank transfer. What PayPal do here is credit the recipient on your behalf (so there is no delay in despatching your item). Then if you receive a refund in the meantime they are unable to issue this until the original bank transfer completes.
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You had 1 payment OUT of your bank account and you would have had 1 payment IN to your bank account so you are back as you should be.
The only thing that is confusing but perfectly normal is that your refund was CREDITED BEFORE your original charge was DEBITED.
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If the refund showed in your paypal account then you would have been refunded, either to your paypal balance (and it was used for another purchase) OR transferred to card or bank. Paypal issues thousands of refunds every week and no one seems to have an issue as the process is automated.
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I know how refunds work and they are automated and go back to the source of payment.
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