Stop payment in most states is only under certain conditions, check with his local laws. You may get it overturned talking to his bank and explaining things. I know in FL, this doesn't fly. Show his bank this email, and perhaps they can help. Conditions for a stop payment have to be met. New laws about checks have changed. Look into that.
I have a lot of shipping/transaction experience over several years with a Feebay store, and I don't ship with a label on the bare box ever. For your elderly friends sake, their kits need to go out better than what you're doing. Covering the box in brown paper or like myself, put a skin over it with cardboard, is the right step. That is upsetting to see the collector value decrease, but he's pushing it down a lot more. It's really not his call to insist he's not returning the kit. It's not his property if he stopped payment on the check.
Don't be coerced into him telling you what you should sell the kit for and just accept that, he should just send it back. You're right, he's trying to profit off you. He doesn't have any right to dictate terms that sound like ultimatums, however he has the kit and the money.
I would show him this thread, and he's likely on another RC forum, be sure to post there as well, but do it on the "other site" category, it's correct, but no one will see it. While his communication is rude, you two need to work it out. Perhaps refund him his stop check fee and you're still ahead?
Other than public shaming, you have little else on your side.I bought a pristine kit for $150 because it has collector value, and the identical kit in the wrong box for $45. Same wood, different box. Box matters. Condition matters.
You did lower its value if what he says is true, but he's pushing more than anyone else would, by my guess. You can try to negotiate it up, with nothing to make him say yes.
Do not take any form of payment in the future but PayPal, or USPS money order. Never take another check. For the money you're going to have to fight over, and the stress, you won't forget these rules of selling. Asking him to return it, if he were truly unhappy, would resolve his issue. Too bad he can't come here to the thread and show photos of the finished product, if it's minor or now looks like a piņata you'd swing a bat at. Where are your photos? I take photos of everything I ship, to cover my end should any dispute like this arise.