While if I was the buyer I would not expect it back, if you can resell it why not give him his money back if you are not out anything. I, as a constant buyer, and rarely a seller, avoid this problem by never buying anything where the seller asks for a deposit. Not only for this reason (because something could happen in my life it does everyday to folks) but because it is WAY more common to see people that pay a deposit never getting what was promised (or waiting for years) I know that is not the case here, but it sure seems more common then people asking for a deposit back. I just figure that any seller who needs a deposit is playing it close money wise anyway and (like with the buyer) things come up and you are out your deposit. I suppose if I was to say that the seller should keep the deposit then I also feel that if the product the deposit was paid on is not delivered when promised then it should be returned promptly.
I don't know what the answer is, I always try and error on the side of kindness over greed when possible, but every situation is different and I am just trying to avoid bad karma. My only personal solution is to not buy any "project" that requires a deposit. It just requires too much faith on everyones side, and too many horror stories here about these things.