Bonnie, you're right. The identification of works of art, antiques and musical instruments is complex and often a matter of opinion rather than verifiable fact. To decide whether an attribution is correct requires expert opinion, and at the very least the seller should be allowed to put forward their own expert - that is what would happen in court.

Even if an attribution or a label is decided to be incorrect, that does not necessarily mean the item is "counterfeit" in the same way as a dodgy watch or designer handbag, or that the instrument is not of value in its own right. Counterfeiting law seems to be intended to protect trademarks and commercial activity as much as (perhaps more than) consumer rights. That clearly doesn't apply in these circumstances.

"Counterfeiting" required dishonest intent. We don't know whether the alleged misattribution was an honest mistake by the seller or done with intent to defraud, although the fact she has posted her story on the internet inclines me to the former view. However that should be a matter for the police and the courts to decide, not Paypal.