Difficult situation. I've been on the receiving end of damaged deliveries before now, and it's a lot of hassle.
Seems to me, if the form the buyer signed stated that the buyer had checked the item, then he has no comeback. Although, as CJ said, a small claims court may think differently if the buyer wasn't informed verbally as well.
I think it's fairly common knowledge you should either check the goods you are receiving or at least write "UNCHECKED" next to your signature.
Personally, if I was the seller I'd accept the 100 quid the courier company offered, give it to the buyer and leave it at that. It's then up to the buyer if he wants to take it further.