I think it's the buyer's responsibility to know about what he is buying. The seller is responsible for the item's condition, not its functionality. I bought a Meridian 598 with progressive scan and didn't discover that it didn't have outputs compatible with my TV until I tried to hook it up. Duh! (I bought a used 565 to solve this.) I bought a remote for one of my components and didn't find out that the component didn't have the circuitry to receive remote commands until I tried to use it. Double Duh! (It's in the drawer now.) These are MY mistakes, not the sellers'. If I had wanted, I could have sold my mistakes on Audiogon.
Now, having said all this, I would nevertheless be willing to take back the Camelot dvd player IF the buyer really wanted to back out of the deal. He should pay for round trip shipping and any transaction costs (credit card fee, etc). I would relist it for sale and hope to get a comparable deal. In other words, he would make me whole financially (presumably not a big number), but I would be willing to put up with the hassle of trying again to sell it. I think this position is reasonable on both sides given the sense of community courtesy and mutual respect shared on this site. No one wants to be taken advantaged of or put at a disadvantage, but I would try to be civilized and understanding about the whole thing.