The response from the developer you quoted is hard to understand, but it sounds as if they're saying that after the incorrectly settled bets you went on to double one or two more times before winning, and that at no point did the incorrectly settled bet cause you to bust a martingale sequence.

So by refunding you 0.14 rounded up to 0.2, they're giving you more than they needed to.

You could argue that if you bet like this:

0.01 (incorrectly settled as loss)
0.02 (loss)
0.04 (loss)
0.08 (win)

Then your profit should have been 0.01, and it actually WAS 0.01, and so they don't owe you anything. Or could you argue that if the first bet was settled correctly, your bets would have gone:

0.01 (win)
0.01 (loss)
0.02 (loss)
0.04 (win)

and so your profit would have been 0.01 + 0.01 = 0.02, and so their error cost you 0.01 which they now owe you. It's hard to say what the right thing to do is.

But your main point (other than the delay in resolving this whole mess) seems to be that they can't prove that you didn't go:

-0.01 (incorrectly settled)
-0.02
...
-1
-2
-4

at some point.

I don't see how they can prove that to you now. You don't have a record of your bets, and they could in theory make up anything they want. What if they give you a list of all your bets, with betids, and just edit the bit where you busted? You wouldn't be able to tell the difference, because you don't have a record to compare it to.

If it was me, I would just give you a database dump of all your bets, with betid, stake, roll, seeds etc. and let you look through it for yourself and verify everything. That seems like the simplest solution here.