Since she hasn't paid I THINK you have to agree but don't just cancel it on your end, report her first. As soon as you bid on an item you enter a contract to buy it if you are the highest bidder, so she should really have to pay. it's up to her to measure the room and check it would fit first, silly person. I'd be pissed off too x
It's up to you, you can either cancel the sale or open a non payment case. If you do the latter she will get a defect on her account for non payment. It depends on your stance oncoming down on non payers!
Just to double check as it's a large item, you weren't going to accept PayPal for a collection only item, right?
Risks are, to maintain your seller protection you need to have a proof of delivery when you sell an item.
If a buyer collects an item then you can't get that, so they can claim they have never received it and PayPal will refund their payment.
Only an online proof of delivery to the buyers address that accompanies their PP payment will do, getting the buyer to sign something ect when they pick it up WON'T.
By accepting cash only you're protecting yourself as the eBay / PayPal won't get involved.
The complicated bit is, even though eBay advise cash only for collection items, you have to offer PayPal as a payment method on your listing. All you can do is write on your listing CASH ON COLLECTION ONLY. And if they still pay by PayPal, refund them and remind them cash only.