You did the right thing. I know it is hard, but he is going to do so much better with the breeder. You are absolutely right, you DO NOT need a stud that potentiall has genetic disorders...this would be setting yourself up for a disaster, with potentially MORE heartaches down the road. I am sure that River is thanking you for saving his life.
May I ask...what do you mean that the breeder is drawing up the paperwork to return him? Return him to where?
I don't know much about the breeding business, so I'm just curious.