I think Beth has nailed it. As you point out, Marley, the manager was giving you a break by letting you return an item after the exchange period. So, in one sense, she was providing service beyond what was expected.
BUT, trying to humiliate you after being the "good guy" is just plain dumb. I teach a communications class to business majors and constantly try to get them to understand this very point. If you refuse to provide a refund or credit, you make that choice knowing you may lose that customer's future business, but, at least, you get to keep the money from that transaction. If you choose to refund, or give a credit, you do so to maintain goodwill, even if it results in a loss of revenue.
So I tell my budding entrepreneurs, once you've decided to provide a refund or credit, put on your best smile and make the customer feel like he/she did exactly the right thing by returning the item-- because the only thing that makes you happy is making the customer happy. Providing a refund (or credit) in a way that makes the customer feel humiliated or upset is the ultimate stupidity-- you manage to alienate the customer while providing him/her with exceptional service.