New Seller -> First Returns -> A few questions please

Hello all. A little insight regarding returns would be helpful. I am new to Amazon selling and received my first 2 returns, irritatingly from the same buyer. Both orders were originally shipped in one box to the buyer for around $6 USPS

1. First Return - he selected "Better Price" (which isn't true as I am the only one with this specific product). Amazon auto issued a return label via USPS (around $5) which was just fine.

2. The Second return - he selected "Defective, doesn't fit" when in reality he ordered the wrong product which was very clear in the photos, what I sent his is NOT defective, it was his error in purchasing the wrong item. I believe this "Defective" is a penalty on me as the seller. Is there anything I can do since I am very new and will these two returns cause Amazon to penalize me? And my return policy says returns for items in original condition so if he sends it back as used and unsellable then what can be done?

3. For the Second return Amazon auto issued a return label but this time through UPS and is charging around $25! Why did they do that instead of USPS for $5, is there any way to select USPS only for returns?

4. I read online that I can choose to authorize returns myself but I didn't see that option, is it because I am very new? It's just frustrating because I could have resolved the issue without a return, perhaps just a partial refund and explanation on how to modify the product to his needs, and not have chosen expensive return shipping.

5. And in all scenarios will I have to pay return shipping or is there a setting to avoid that in certain situations?

On a side note, right after he "returned as defective" the second package he ordered the CORRECT item. I'm super irritated that he has cost me a lot of money with these three orders but there is no recourse for him. So frustrating.

Thanks for any guidance in making my returns easier/less costly.