Have you verified you cannot book anything close to the $700 rate any more yourself ("pretending" to book from scratch the same way you did originally)? As was mentioned above, it could be rate changes over time, but it could also be a change of AWD. Does the reservation still show the same AWD that it did originally?

Anyway, rates can changes constantly, so be on the lookout. For all you know, it could go down to $600 sometime between now and when you travel. In many locations, I often find the rates go down a couple weeks before the travel date, though then go up even higher a few days before the travel date. So it can pay to check often.

You have your offer of $700 refund to fall back on if you keep the reservation as is, but be on the lookout of whether you could make a new reservation (with your Wizard number already plugged in) of similar value sometimes in the months you say you have left. (Then if you do, and only if you do, cancel the old reservation.)