First chat post here for me. Just for some clarification.

The buyer was returning 2 items to 2 different sellers (me and someone else) and they accidentally put the wrong return label on the wrong box and I ended up with the other sellers return and vice versa.

The buyer thoroughly admits this that it's their mistake. 

All 3 of us have been in contact with each other and it's all civil. The buyer at first wanted us to send the items back to them, they'd swap them over and forward the correct items back to us. I explained to them that I'd have to turn the return into a case because doing things this way will mean no seller protection and as refunds have to be processed within 48 hours of the return arriving (so that would likely be when both returns are en route back to them to swap and they could quite easily keep both returns after a full refund).

So here we are, both me and the other seller have turned the return into a case asking eBay to step in waiting for the outcome. Since typing this in prep earlier the other seller said eBay's outcome for them was buyer refunded and that's that. 

Was that the right way to do it?

It's just a bit of a worry now eBay staff will step in, refund the buyer and land us both us sellers with defects, even though we've done nothing wrong and we all just want eBay to say how we can resolve things (including getting our correct returns back) within eBay's rules. It's quite the unique and unusual situation which isn't my word against theirs, the buyer takes full responsibility for their mistake and we were all just trying to find a way to resolve it.