Amazon is in a hard spot with this stuff. They have massive problems with refund fraud, where people buy things and returning fake or used items in the box. Asking for ID is one way they try to spot people who are engaged in this activity repeatedly. When you refused to show your ID and did a chargeback, you did the exact same thing actual fraudsters end up doing, and of course they need to fraudulent accounts as otherwise the whole concept of mail-order returns collapses.
You didn't explain why you didn't want to share your ID with Amazon, but it's not an unreasonable request from them as a way to combat fraud.
While understanding their motivation to combat fraud they have a 20-year purchase history and have already established identity through payment methods. This is just lazy and perhaps additional data harvesting.
Amazon got so large they stopped paying attention to the details.
Fraudsters almost certainly gain access to old accounts specifically to "buy" that trust and then farm it for their own uses.
I wonder how much a 20-yr old Amazon account is worth on the grey market. Mine is about that old, and I have – legimately – returned thousands of dollars worth of goods (that were faulty or just didn't work the way I liked) and it is probably very difficult for Amazon to distinguish between my legitimate returns and a hypothetical alternative where I'm a fraudster that just purchased this old account and am laundering broken electronics through the returns system.
How is ID going to help with this in any way? They charge you (bank account/CC) and send you stuff (address), they inspect the return (or rather Should inspect it). What more would they need?
They don't inspect every return - that would make the already ropey economics of allowing returns very unviable - and it's often hard to detect return fraud because the fraudsters are returning an object that's nearly the same as the real thing, just used in ways that maybe aren't obvious given a casual inspection. Or they've raided it for parts and the object looks the same but the internals are gone.
It's not only Amazon that has this problem btw. Lots of online stores do. Return fraud is so prevalent that you should expect to this to become more common. A few bad apples ruin it for the rest of us.
Payment details aren't enough to reliably establish identity in many cases. If fighting this stuff were easy they'd have done it already, they aren't idiots.
So how is buyers ID going to help with Amazon not inspecting returns? Amazon doesnt even mark returns in any way so they dont know where it came from and where it ended up. Hell, they dont even mark/track source of co-mingled inventory!
And crucially - Amazon doesnt do this tracking on purpose so they can have plausible deniability while screwing merchants.
It doesn't help with inspecting returns. It simply adds another hurdle that has resulted in a slightly smaller percent of fewer returns, saving them a significant amount of $$ at scale.
Btw, if Amazon is a fault, where they can't shift the loss onto a seller or third-party, the delays will go on for weeks, if not forever. You have to do a chargeback.
You didn't explain why you didn't want to share your ID with Amazon, but it's not an unreasonable request from them as a way to combat fraud.