No chance of him wriggling out of it as it seems like a catastrophic failure that was, obviously, not present before that garage carried out the work. Stick to your guns. If necessary small claims court, but it sounds like they are, begrudgingly, prepared to do what is necessary.

cant remember that dent on the quarter panel being there before

One other thought and would like some input from you guys.

As you can see a fair portion of the unde3rside is nicely coated in oil. On the one hand no bad thing as a bit of added rust protection but I am a little concerned about the safety aspect.

I drive down the road, wet day, and I will be spraying oil droplets out the back as it is "washed" by the surface water. Some one following wont take kindly to have their screen coated in a nice film of oil.

Should I get them to clean, possibly steam clean the car's underside? It will then need re sealing with waxoyl.

I wouldn't bother if it were mine, I drove 20 miles with diesel ****ing out the tank, covered the whole of the back of the motor in fuel and must have made a mess on the cars behind, didn't even get a flash from them. I found out when I parked on the drive and it ****ed all over the place.