That's a dumb move on the part of the seller. If you were clear why the item is SNAD, both for condition (altered) and fake, ebay should find in your favor and the seller will get a ding on her account for not just accepting the return but requiring ebay to resolve it.
But that's her problem, not yours.
You should get a shipping label (addressed to the seller) paid for by the seller which you print and attach to the return package.
It said nothing about returning. Just the full refund.