Sorry for the problem.
1. Typically you do not have to come to the closing in person, however you can go to US Embassy or Consulate to close. This may be easier and less expensive for you.
2. Not sure how the seller can pull out at the last minute. That would be unusual if you have a signed contract. You may want to get counsel involved if you wish to proceed with the purchase.
3. Sometimes it can be tough to get the money back from title company. Here in Texas we must now get the seller to sign a release or not respond to a demand letter before they will release it. Keep after them. Keep after your agent, and the title company to see what they can do to facilitate the return.
To avoid this to never happen is to make sure that you Realtor does due dilligence and finds out the motivation of the homeonwer. But really without knowing explicit details, we can't give you more advice as to how to avoid this to happen.