issue arises though is when there is a situation where person A cannot get a refund for bad service from B so A hopes B goes offline before B can send TX2.. so that A can send TX1 and hope that B doesnt wake up to send TX2..
This is kind of stupid. Like in normal bitcoin transactions, payments are irreversible. If there's no escrow, there's no way to "get a refund". Once you've paid, you've paid. What you are complaining about, is essentially that A has no possibility to steal back his money, and if he tries so, he risks to get screwed. Well,
the whole idea is that if you try to steal, you get screwed, yes. With a normal bitcoin transaction, there's not even the smallest possibility to steal back your previous payment (unless you attack the block chain, and orphan the prong in which your payment was done - usually a more expensive undertaking than just propose someone to pay him if he kills B, say). Now, the LN system may let you a tiny hope to steal your payment back, but it was designed to make this very risky. You cannot use the tiny risky potential to steal in an LN as a normal way to "get a refund".
im not saying its the way to get a refund. im saying that B can blackmail A,
many people over many months have been promoting LN as the trustless system of decentralised control.
the reality is that LN is (using a bank analogy to ELI-5 it) a joint account with a spouse..
and that spouse has another joint bank account with the plumber
if YOU want to pay the plumber. you tell your wife she can have a % of you and your spouses account balance. if she then uses her other account with the plumber to give the plumber a % of that separate joint account.
its not about your funds entering the plumbers account direct
its also worth noting and people need to accept the risk that their funds are no longer 100% theirs in a channel.. its not a sole holder bank account. its a joint account. because it requires the other person to agree on what you want to do with "your money".
but back to the topic as the scenario has meandered.
the revocation key is not something you request when a dispute arises. its something thats already part of the latest tx, to revoke any disputes of using previous tx's (but a slight risk the prev tx can succeed if the latest tx is not transmitted in time)