Loveablebuilder sent me a copy of the receipts and they do show a GBP/EUR rate of 0.8957 instead of 1.16.
Apart from being an insanely “unfavourable” rate (basically switching the values of the two currencies) it does seem he was charged in GBP, as it does refer to GBP 223 being the transaction amount.
My guess at this point is that - given the the UK does not use euro - a euro withdrawal in the UK is always converted to sterling (being the default currency) and only for that sterling withdrawal one gets the option to have it converted to euro or have it charged in the original currency (which is what Loveablebuilder chose and which was properly applied).
The problem seems to originate from the seemingly mandatory first conversion to sterling at that insane exchange rate.