wow. what a mess.
I've been selling on eBay and haunting the Community Help boards there for almost 6 years and here is general practise (what the majority of reputable dealers do) over there:
In cases where the buyer claims that the item has been misrepresented the seller generally offers a full refund and the buyer returns the item. The seller may or may not pay for return shipping - it's the seller's discretion whether to do so or not. In fact, the seller is not even obligated to refund the shipping fee the buyer originally paid—only the item price. Now, if the seller is really at fault, a good seller would be happy to absorb the shipping cost both ways, but a seller is under no obligation to do so.
In my experience the simplest route is always the best one.
Please don't take this as a criticism jac but no matter how wronged you may feel, the seller has made you a reasonable offer. You need to decide if you want to resolve this and move on or not. If not, well, that's your call. If you do, send her the fish back (registered mail!); don't assume that she's a cheat and won't refund your money. That simply clouds the issue and gets you nowhere. I wouldn't leave feedback for her either. If you do decide to though, make sure it's a plain statement of facts - no emotion! When I check a user's feedback the fb they have left sometimes tells me more about them than the people they are leaving the fb for! If she doesn't refund your money after she's rec'd the fishies, that's another issue you can deal with later.
I know that if you accept her offer you're taking a financial hit, but you made the decision to bid, no one forced you to. Buying online is tricky & sometimes you just have to make the best of a bad lot.
well, that's what I would do anyway.
<climbs into flame-proof suit>