Please correct me if I'm wrong, but the situation as I see it is, (and yes I read the posts, except for the idiots in the dogpile) you ordered the net tent and tarp for $350 + $21 for shipping for a total of $371 charged to your credit card. When you received the gear you found damage on the net tent and returned both items, at your cost I assume. You then canceled the entire order.
In my humble opinion, the refund should be for the cost of the merchandise plust the amount it cost for you to ship it BACK to SMD. Had you not canceled they should have eaten all shipping costs except for the original charge. But since you did cancel, I believe SMD is entitled to something to offset their costs (order processing, etc).
What I would have done is amend the order to send the Cuban stuff instead. Either let them keep the original charge, or credit your account and then charge the correct amount when the Cuban ships. That would have put you at or near the top of the list when the Cuban becomes available.
Finally, as a few others have mentioned, this whole mess could have been avoided with a few phone calls from either side. Emails are notoriously impersonal, and rarely do you get you true meaning across.
And no, I am not a SMD fanboy. I have only placed one order with them and was completely satisfied with the quality of the product. My only beef was what I thought was a slight design flaw.