Help, what should I do?

I started planning our trip to CSS over a year ago deciding the room type we'd like - one bedroom ocean suite with balcony (a large balcony and great view are very important to us).

We made our reservation, with a travel agent (the large auto association) at the beginning of March. I specifically requested the one bedroom ocean suite with balcony, and have the confirmation email from the travel agent stating that was the room type we had reserved.

Yesterday, I found out that the agent had reserved us an ocean suite (looks like they are in building "C"). I understand from the message board these doesn't have a balcony, and, appear to be located in the middle of the resort near the bars and restaurants. I know that many would like be in the center of activity, but, it's not the quiet cliffside location that we would choose.

I spend a long while on the phone with the travel agent today, and they admitted it was their fault. They contacted Couples, but CSS is fully booked November 7 - 14 so there is no chance of this error being corrected and us getting the room type we really wanted.

So what should we do? We can get a full refund (hotel, airfare and insurance) and look at another date (and this time I'll make our reservations directly with Couples). Or, we can go and risk being disappointed. I know there are no "bad" rooms, but when you've made plans, and have expectations, it's really disheartening at this stage to find this out.

Any words of wisdom for this very disappointed couple?