you can't tick the 'other' box anymore to type in you want a refund so I dunno - worth asking in the dispute. But the buyer can still claim from royal mail for the lost item - and of course leave damning feedback and stars. That is what I would do. Is surprising how keen to resolve a seller will become after you have left appropriate feedback.
A "no fault" refund isn't guaranteed and it's only at the discretion of eBay. I've never had one in over 13 years of eBay'ing and there doesn't appear to be a definable criteria. If you start a SNAD (significantly not as described) case, then you'll take a gamble as to whether the "no fault" refund will be applied. In many cases, if not most, eBay ask you to return the item by trackable means and now often provide the returns label for you and pay for the Parcelforce delivery. Basically, this means that you won't lose out on the return postage As you've already returned it, you can't fulfil the criteria for the claim to be completed.
All you can do, is what others have said, leave appropriate DSR stars and feedback, then claim back from Royal Mail.
Hindsight is a marvellous thing but when sending goods back to a seller, it's always advisable to send it by a trackable method because you have to prove safe delivery and receipt.