Electronics Boutique has had some real "winners" e.g., some really messed up games, it happens. I'm not justifying selling a bad CD/DVD just explaining it happens.
Some video stores will resurface a CD/DVD for a few bucks, it's up to you as the CD/DVD may be too damaged to restore and you may just be spending more money and getting nothing in return.
I don't know about the auction, it depends on how it was worded, whether or not you can do much other than give negative feedback, and even that is limiting...Depending on how many transactions the seller has made, it may not accomplish squat.
I'd try to negotiate first then post negative feedback as a last resort.
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-Dreams of getting a new 360 XBOX in 201x.
-Current consoles: Playstation 2 and Wii, also has DS/GBA and a PSP 3000
-PC: AMD 5000 2.6 Dual Core, 2GB Ram, 8600 GeForce GT video card, SB Live!, Win XP SP3