You were not ripped off, you made an irrational decision based on an assumption. You sold your PS3 so you got paid for that, and you got your money back for the ps3 that wasn't sold to you. Yes the seller is a dipshit for doing what he did assuming that is what actually happened and you're not assuming anything. But you're out your PS3 because you choose to sell it assuming that you just got a new PS3 for $70 less than retail, you should have waited to receive the new ps3 first, then sold the old one.
Face it, you're really upset because you sold your old PS3 and probably don't feel you got enough for it since this seller didn't follow through. The seller gets dinged on his cancellation rate and if he makes a habbit of this, his account will be suspended, but for one cancellation, no it should not be suspended.
With the money you made from your old ps3 and the money you got back from amazon, you should have enough to buy a new ps3 retail.