Letting him off the hook costs you very little, will give you a good feeling (priceless), help you develope a good reputation (priceless), may teach the other guy a couple of things, and it does appear clear that it was an error. A lot of good people have said pretty much the same to you, but I want to applaud the fact that you didn't take a give me the money attitude, but took the time to seek input from others as to what "the right thing to do" would be.