I think in this type of situation, it's a reasonable expectation that the recipient should return the PS Vita too. They paid £19.99 and got sent a completely different item; it isn't as if the PS Vita was priced at £19.99 in error and the company mistakenly fulfilled the order.
It's only reasonable if the company is compensating them for the expense and time of sending it back. Personally, I would only consider it if the company was at least offering to send me the correct merchandise after refunding my £19.99 in exchange for the return. I'd probably hold out for a check for £19.99 in addition to a full refund and shipment of my intended purchase item. I'd call it a "restocking fee". If I had mistakenly ordered a PS Vita and then sent it back, the company would charge me a "restocking fee" too.
If they refused to compensate me, I'd just sell the Vita, buy the correct game from someone else, and pocket the difference. I would see this as fair, because it would require additional effort to obtain the item I had paid for but not received, and I would expect to be compensated for that.
When I lose something, I offer a reward to get it back. I don't threaten the person who found it.
Sadly, I see similar situations happen all the time. Companies make a mistake with their pricing online and don't fulfil the order and the people who thought they were getting a 40" TV for £50 start talking about their "right" to buy it for that price.
That's because it's dangerously close to a bait-and-switch, which is illegal. It's only not illegal if it is genuinely a mistake. If you're advertising a 40" TV for $50 without any conditions, then customers do, in fact, have the right to buy it for that price. If it is an honest mistake, and the company does not ship the item, but simply refunds the customer's money, the customer has still been harmed. The company has wasted the customer's time.
Let's turn it around a bit: if the customers had asked to return the game they bought and accidentally sent a PS Vita to the company, would the customers be arguing that their mistake represented an "unsolicited gift"?
The company would probably send it back, not because it's their duty under the law, but because it makes good business sense. If they didn't send it back they would lose that customer forever, and they would badmouth the company to others. It could easily end up costing them more than the value of the item.
On the other hand, other than the legal threats, the customers have no incentive to send the devices back. If Zawi refuses to ever do business with them again, they'll just buy stuff from someone else.