I really don't understand the fuss.
Some people here seem to imagine that they live in an ideal world, with all people being friendly to each other. Nice. But as far as I remember the real world outside isn't ideal.
The seller of the bike seems to be a very smart guy, kind of a vintage bike "pro". With THAT ad he did everything right to legally "enhance" the value of his bike and optimize his profit (and he almost certainly made a profit). Clever. And there's nothing you could do against it - legally. He didn't conceal the scratches, he just didn't show them on pics. He didn't write about "original" paint and was very careful with his wording in the ad. Remember that YOU would have to prove any kind "fraud", so your legal position isn't too good.
AND - he added a clause, that any kind of warranty is ruled out and that you abandon potential rights to return the item, as he's a private seller - "caveat emptor". And told you to NOT BID if you don't agree. DOH!
So learn to not just run over, but UNDERSTAND an eBay offer and you won't get ripped off by the "big boys" again.
Citoyen du Monde is right (he always is), you are wrong. Sorry.
Paint it and sell it, you won't get too much on the market in this condition. (Some of the "big boys" would give it a cheap sales paint job and sell it with poor pictures, some others would give it a good paint job and sell it with perfect pictures; choose and learn.)
Or follow my personal advice: just remove the paint and sell the frame in it's bright chrome finish - as he told you that it's fully chromed underneath, boy

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Young madcaps ...
