I think it is pretty obvious that this person (the dogs current owner) only has one thought in their head and that is money!!! Perhaps the dog at adolescent stage is too much for them so maybe they saw the dog as a cash cow and thought they could have a full refund and use the money to buy more Christmas presents.

But money certainly is their ulteria motive here, how very sad for the breeder.
As already said this is totally unreasonable. I wouldn't even expect anyone returning a dog to breeder at this age due to
their illnessto be anything but grateful that the breeder would have the dog back, money should not even be thought of. Should it?
Not to mention the time of year it is, many people do not have spare cash around at this time of year of course the breeder may not have the funds even for a small refund at this period, Christmas costs us all a fortune.
There could be one other alternative, do you think the owner thought the breeder would keep the dog and may be a little upset that the dog may well be sold on? Could also be a reason............
But whatever, I'd want the dog back, but if your friend can not afford the price asked (she shouldn't have to really, but sometimes we breeders get backed into a corner :-( ) she could call her and try again to explain as already said dogs of this age do not sell for the original price, who knows the dog may even need totally re-training by the breeder, usually the case! All extra work, time and effort before re-homing.
Otherwise keep an eye on all ads they are not going to send it off to rescue if they want the money and perhaps when you eventually see the dog being advertised ask a friend to buy the dog at I'm sure a much reduced price, just keep checking daily.
All very sad the breeder was more than reasonable.