hi OP, sorry to hear about your ebay transaction. i agree that the seller should have disclosed the flaws (with pictures), and not pass it off as new when it clearly wasn't. if you really love the bag, i hope you can come to a reasonable agreement with the seller. as the above poster stated, $350 seems fair if the bag was in great condition otherwise. however, were it me, and if i'm undecided on the bag, i would just ask the seller for a refund and return the bag, just to not have to deal with the headache of back and forth communication and price haggling. hope it all works out for you whatever you decide.
btw, i normally don't like to get in the middle of "fights" but i have read papertiger's response to your post, and it doesn't seem to come off as rude to me.

i don't think she was suggesting you go to the ebay website. i think she meant that the ebay forum
on tpf may better address your issue. the link to it is here:
http://forum.purseblog.com/ebay-forum/
hth!