It wasn't a PO Box, was it? It could be sitting in the wrong post office.
I guess even if it was a street address it still could be sitting in the wrong post office. It seems like the sorters would figure it out but who knows. Or maybe someone did figure it out so it's just been delayed.
Maybe the customer could call the post office in the city DC says it was delivered and check?
How strong of a case does DC really make when a customer files a claim with PayPal? (Assuming they paid via PayPal.)
I don't know, that's all I've got.