For sure the Post Office has different levels of service - which involve different scales of payment and different levels of compensation.
But what I was hoping to convey is that proof of posting is not the same as proof of delivery, and that at each stage of the transaction a contract is entered into. Imo, it's essential to focus on who enters into a contract with whom - for that determines who is responsible for what.
I don't have a dog in this particular fight, but I find it somewhat odd that the seller has refunded postal charges (and by doing so is accepting that delivery has not taken place) and yet refuses to refund for the goods which were not supplied as a result of the non-delivery. I assume that the contract entered into was to supply (i.e. to deliver into the purchaser's control) five live queens which were fit for purpose, and not just to post five queens in the hope that they would eventually turn up. The form of that particular contract is key.
This is much easier to grasp in cases where much larger deliveries are involved - say, with a bulk cargo delivered by ship. The contract may specify that the goods are to be delivered onto a particular quayside - which can be challenging in some third world countries where cargo handling facilities can be primitive. But arriving at the port is not fulfilling the contract - the goods must be placed (undamaged) onto the quayside itself. Only then has the contract been fulfilled, with control (and responsibility) then passing from the carrier to the customer.
It's exactly the same with Ebay - even if the seller has proof of posting, if delivery has not been effected, then the purchaser is refunded at the expense of the seller.
On a personal level, of course I have sympathy for the seller here, as this screw-up is not of his making, and no doubt he did the best he could to ensure things went smoothly. But I have even more sympathy for the purchaser, who - quite rightly in my opinion - feels 'screwed-over'. I would too, in his place.
At the moment we have a 'lose-lose' situation: the purchaser is out of pocket (and out of queens), and the reputation of the seller has taken a hit.
But the 'guilty party' here is the Post Office, and it is they who should be bearing the financial loss - not the purchaser.
LJ