If you end up in a stalemate such as this you must put your request for a refund in writing (and must include your address and other personal details).
If they respond (in writing) and refuse a refund, you can take it to Consumer Affairs Victoria who will look at the case as a third party. They will (after a week or two) get back with what they think is a fair solution to the problem.
This decision is non-binding and either or both parties can ignore it.
It can then be taken to VCAT (Victorian Consumer Affairs Tribunal), at a cost of $40, where the process is repeated, but their decision is final and must be followed. Update: I've since discovered that although this is binding VCAT will not follow it up. In order to force the company to pay you must take them to a real court (Magistrates) which is expensive. End Update
Think Judge Judy only slower and less funny.
Personally, I don't think it's worth the stress and effort for $450.
I am vaguely irritated though that the law provides a clear statement that the consumer is allowed to demand a refund (over an exchange or repair), but doesn't explain that this is pretty much irrelevant and that the consumer could have demanded an elephant for all the business is concerned.
The business knows the process is irritating and complicated and that most people wouldn't be bothered. So they can get away with saying "we don't offer refunds" despite the fact it is clearly illegal to do so, because the process to fight it is difficult and stressful.
And this is why AWAs and the fairness test are evil. You can put all the process in you like and inform people of their rights, but if the only way to gain those rights is through a long and irritating process that may end in either or both parties in tears, it's hardly fair to pretend it's the same as a clear cut rule (like "you must be paid overtime for public holidays").
The rules around AWA are the same as this refund problem. Your company may offer you a contract that doesn't include overtime. You have a "right" to complain and request overtime. The company must either give you overtime or pay you more over all, which ever is "deemed" fairer. Rather than a clear cut law, it must go through a third party to sort out.
This isn't the way to solve our problems.