Frankly speaking, this is the first time I hear a casino give a refund when a gambler ask for permanent self exclusion, so the first thing comes to mind is that there was a miscommunication in the first conversation.
Maybe he used the wrong term here! What I believe he wanted to say is that they (Casinopunkz) agreed to temporarily re-open his account so he can withdraw his remaining balance and not to refund the money he lost.
That’s the only logical explanation unless he misunderstood what the support agent told him language barrier) as you suggested.