The fix is easy using linux fdisk and probably is just as quick in bsd & osx (Windoze fixes have been posted already). Getting a refund depends on how you deal with the supplier; I'll tell my tale because which Operating System you use shouldn't matter when taking naughty sellers to task.
Ok, so you've got a cheap Chinese player and it seems to work ok until you fill it up to much less than the stated flash memory (whether as advertised or what the device tells you itself or tells your computer). Sound familiar?
This is the type I bought with advertised 8GB, item number 320302882082. It started having hissy fits when about 3.8GB loaded: I figured it was wrap-around leading to corrupted files, i.e. flash capacity really about 4GB.
I did what others have done and took the back off and checked the chip number against manufacturer specs. The chip was Hynix (not Samsung as advertised but specs. are online so no big deal) and the actual size was 4GB (quadruple die each of 8Gb, i.e. 4 x 1GB), not the 8GB reported by the controller or the partition size that exceeded 8GB, allegedly.
With that information I contacted the seller and called foul ... no problem getting full refund apparently but the usual malarky involving my losing out on postage returning the player; 'nuff said. However, as well as looking up the chip specs. I ran fdisk and re-initialised the partition table so that the controller is asked for the CHS which correctly represents the capacity of the storage. Sorted. Incidentally, you don't need chip specs. for this bit but they're handy when talking to the seller (and probably useful if you want to get your money back and go the Trading Standards route). I've no idea whether the player was hacked by the seller or at the factory but I suspect the seller knew what they were selling.
Anyway, I ended up with a neat little 4GB player. Apart from 8-bit front end crawl (waiting for each button click or press to register can be tiresome) and umpteen button clicks to select a track (no wheel) it does everything as advertised and even drives decent over-ear headphones close to max. volume (26/30) before distortion gets unbearable, equalisation flat ('Natural' in the player menu); 15/30 is ample for easy listening though. Video is clear for the size (1.8-inch state-of-the-art so no surprises there) and there's quite a bit of lag in refresh so blur of quick movement could be annoying. File transfer is reasonably quick although well under USB2 capabilities; using the player menu Delete takes forever though so best to work in File Manager for mass file housekeeping. Jack socket is 2.5mm and not too clever (and the earphones that came with the player were naff of course) but a 2.5 to 3.5 extension seems to do the trick for all my 3.5 mm stuff including line in to my HiFi. I did the 2 complete discharge/recharge cycles before use (this is in the destructions, in Chinglish unfortunately but fathomable) and so far the battery is lasting about 30 hours running audio. I've not used any of the miniCD software that came with it because it's all for Windoze; the tiny, tiny print paper manual is repeated as DOCs though so the text is a lot easier to read onscreen. Demerit that annoys me is power-saving screen off that can kick in while trudging through files but next click brings it back without losing your place. Equaliser grafix is random pattern too but there doesn't seem to be much point having much else given that equaliser choices are pre-sets (Pop, Rock etc.).
I paid 15 quid inc P&P for the player; I could have accepted that because knowing my luck I could have paid about 15 quid for a '4GB' and got 2GB... However, I hadn't left any feedback at this point so I got back to the seller and told them that I would accept the player but I would have to leave negative feedback. At the same time I pointed out that P&P GB to China would cost 5 quid, not the 1.50 they claimed; puts the seller's overly large sale P&P for 200g package in perspective too.
Bite me, the seller came back and offered partial refund (5 quid) so I agreed and left positive feedback once Paypal registered the refund. The twist is that in the explanation I put 'Hacked 4GB Hynix HY27UV088G5M; fixed (linux fdisk). Satisfactory partial refund.' and gave 1 star ('Highly inaccurate') for description and low scores on others; still pulls down percentages one way or another.
So, if you know what fdisk is about then a player hacked to lie about its flash capacity shouldn't be a problem if a lower capacity is acceptable. More people making naughty sellers squirm as well might lead to some changes too although it took 3 quick emails to the seller and 12 days from auction end to refund in my case but that's not bad I reckon.
(Edited - typos. Duh)