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First off, this is a purely civil matter even if he had a case, which he doesn't, so he can't have you arrested. The only thing he could do is dispute any credit card charge or potentially sue you in small claims court.
But if you have a clear cancellation policy for $15 a night after booking, then 2 rooms for 5 nights is $150 and then $15 more for the last night of the 2 room booking for a total of $165, unless my math is wrong...
Then you add in the cost of the room at $69 a night if that was the agreed on amount for a total of $138.
So unless I am missing something, you could have legally charged him $303 and been fully within your rights to do so.
With all that said, I see you as being entirely in the right here.