Well here is an interesting two part update:

Chase - today I chatted with a helpful Chase dispute rep. The first time I've found one of those. She explained to me that their online system is used solely to allow us to communicate/upload info to them. However, all we will receive back is boilerplate stating "your case is being worked on".m She said unlike other departments, the dispute department does not communicate online in any way and the system is there for customers to communicate with them. I'm fine with her answer but Chase should place verbiage within the online system stating this. I sent message after message, and question after question, only to receive this non-specific identical boilerplate back. I was becoming more and more agitated thinking I was being ignored by some offshore rep with poor english skills. When in fact, this is a corporate decision. Again, no problem with their policy - but let us know please!

As for the dispute, I finally heard back from Hertz Cyprus who said "It appears that you have been incorrectly charged for the damages. I am very sorry for this mistake and for the concern and inconvenience it has caused you. I have naturally taken immediate action to refund your account. The total credit is XXX.XX euro including VAT and will appear on your next statement."

So it appears I will receive a credit back (although with errors like this I take nothing for granted). The Chase agent advised me to keep the dispute open until the credit appears because if it doesn't and I cancel the dispute, while I can reopen it, it must be reopened by snail mail and the whole process restarted. So open it stays until the credit appears.

Wild and frustrating process all around - but hopefully one that comes with a good ending. I wonder how many "errors" Hertz Cyprus gets away with each month?