ticket refund or delay compensation? - 2 different things
does the OP want a refund on his cancelled flight tickets or the EU compo?
2 different scenarios here -
he mentions no refund is forthcoming...
of course it is - if the airline cancels the flight after check in they have to rebook you, or refund your tickets -
if you decide to accept the rebooking then the airline has a duty of care for hotac meals etc (for whatever reasons) until the new departure time
if the OP is after EU compo that applies if the scenario means the pax is delayed more than 3 hours at his arrival airport
if the crew announced here that his flight was cancelled due to being OOH then EU compo should apply as this is an operational reason and not an exceptional circumstance usually -
but what was the reason for initial 2 hour delay prior to cancelling the flight?
so what is it OP?
....no point in pontificating any further until the OP expands his scenario