Hello @MatthewMurdoch
I am sorry to hear about your experience.
Some theme authors implement the “activation based on the purchase code to get the full features” to prevent situations when a buyer uses the same license of a theme on multiple websites (which not allowed by the standard Envato license)
I understand you want to install the theme first on localhost and then move everything on a live server.
I’m speaking now as a simple Envato author: I already did this in the past and all I had to do after finishing the website on localhost was to contact again the author to help me change the code to point to the live server instead of localhost. In fact it’s quite easy and I’m sure the theme author will help with that. Wouldn’t this be easier than refunding?
Also, I can assure you that Envato Support Team is doing his best to help customers, but the reason you mentioned is not part of refunding policy: https://themeforest.net/page/customer_refund_policy
Once again, I’ve read the comments of the theme author on his page and I am definitely sure he can help with moving the license from localhost to the live server afterwards, maybe this could be the solution?