Are you sure you had a quantity of "4" listed? It sounds like the computer thought you had a quantity of more than 4. Thee could be a flaw in the program in which it failed to deduct the prior purchases from your inventory, but that seems unlikely.

As for the refund procedure, let's say you refund $5. PayPal will take part of that from your net proceeds, and part from the fees it had collected. You might give up $4.60 and PayPay might refund a fee of $0.40. The buyer will get the full $5 refund, the combined total from both sources (fees and your net proceeds).

Since eBay thinks you sold 6 items, though, at this stage you will pay final value fees for all 6 unless the buyer appears to back out of the deal (which they generally won't do, in part because it earns them a "strike" that can affect their eligibility to bid in the future). The refund from PayPal does not necessarily negate the sale itself, or the eBay fees that follow. If you contact eBay and explain the mistake, that may take care of the final value fees.

In addition, if you paid a listing fee with eBay, you forfeit that.