To be honest, I’d just cancel and never work with anyone again who can’t communicate clearly.
I don’t really trust CS to be able to handle matters like this. Almost all of the cancellation requests which I have fought have also ended in chargebacks at a later date. There is also the fact that this buyer seems to be a seasoned scammer. They may well be able to follow through with their threat, thanks to CS agents they communicate with not being the same agents who handle your counter complaint.
Obviously, I would hope that this will not be the case. However, I went through a long period of absolutely refusing to cancel orders for any reason. In the end, doing so turned out to be counterproductive. I never got the money, I got bad reviews, and my stress levels went through the roof.