If a merchant selling a pair of jeans for $250 accepts a 1 bitcoin and customer 2 weeks later asks for a refund with a value of a bitcoin going up to $300. Is he going to get 1 bitcoin back or a value of the jeans he bought? Naturally, the value, which means 3/4 of a bitcoin at the time of the refund. So, how does it make bitcoin a currency. ITS NOT!
So because different currencies have varying exchange rates with one another, they aren't currencies? Nonsense, all currencies do this with one another, bitcoin simply has more volatility because it's so knew, and most people haven't figured out how valuable it is yet.
That's exactly the point. If someone doesn't like the volatility then he should not use it. Or in case of refunds he can offer to accept bitcoins only in form of fiat. So that the buyer sends his coins and the coin gets exchanged. He then has the right to get the fiat back. Miner providers did this already.