The seller, AlltechWholesale, was the company that ran eBay's Instant Sale that shut down earlier this year (February I think). I was going to see how much they would give me for my iPad 2 when I was ready to sell it. One month, highest offer online, next month gone. Eventually popped the sucker on eBay and got enough for a mini.

I wonder how they're still receiving device to resell. Maybe their own website?

I don't think this seller would have purposely cheated you. I sold them 2 iPhones in the past and bought an iPod from them, no problem. It's just one of those things where you take a chance on an as-is item.