Yes, to all your questions.
Yes, ask your buyer to check Royal Mail's Track and Trace online with that tracking number to see the instructions there for them to either go to their sorting office ( not Post Office), and collect the item, or inform them of a reliable date, for re delivery.
Should the item be returned to you Again, then yes refund the buyer citing Problem with Buyer's Address.
This fully refunds the buyer, refunds you, your seller fee, and your seller performance is not affected.
Personally, if this was to happen after refunding, I would block the buyer, luck is on your side to have the item returned to you, I wouldn't chance it a third time.
Block them here:
https://www.ebay.co.uk/bmgt/buyerrequirements