To resolve the issue, consider the following points:

- If your order is already paid, it can only be refunded.

- Order cancellation/refund made directly on the Channel does not affect Magento order. Yet, M2E Pro updates your Channel order to the relevant status under Amazon > Sales > Orders. 

- To cancel/refund Magento Order, you need to create Credit Memo in your Magento. M2E Pro will submit the information from the Credit Memo to Amazon and sync the order status accordingly.