Yes they can. They are entitled to refund before dispatch. Only dispatch means a contract has been formed.
Bee are always like this which is one reason reason I don't use them. Misprices are common with them.
I think you misunderstood my post

. I know they can cancel and they don't even have to give a reason. However, if they tell me the reason for cancellation is my payment was declined, I will send them a copy of the authorisation. Just saying, if this is a honest mistake, I think it only fair to give a honest explanation.
Also from their terms and conditions:
The conclusion of a contract between you and us will take place when we accept your order by (i) debiting your credit or debit card, or (ii) despatching goods to you/making goods available for download by you or commencing the services,
whichever is the earlier.
So, if they end up debiting my card rather than just setting up an authorisation I will be able to persue the matter.