Have I been living in a country with weak consumer protection for too long? I can't see refunding the product as byzantine, and I've never heard of anyone getting a refund at the new price.
But if the RAM was sold with Umart's promise to replace it (or the local laws' requirement that they replace it) if it prooved faulty within such and such a time period, then they owe the buyer a replacement.
If they don't want to provide an actual replacement, anything less than giving the buyer a full present-day replacement's worth of money, or a genuinely equivalent or better product, is breaking their own guarantee and/or the local law (I don't know Australian law).
They can't just say "actually it's more expensive now and we don't want to honor our replacement guarantee anymore, so we'll only give you a quarter of a replacement's worth of money instead". That's absurd.
They just want to shove their own bad luck/the consequences of the RAM shortage off on their customers in any way they can, whenever they think they can get away with it.