Free Traffic Legal Advice

On 2nd March 2022, driver (not reg keeper) parked here. Machine was faulty, big queue trying to pay. Most coins were rejected, (many others in queue were paying by cc, getting duplicate payments and wrong carpark option). When our turn, most coins rejected, eventually enough stayed in machine to cover cost, (large sign says, no need to display ticket but machine says, you MUST display ticket) so as being printed, asked son to run to put ticket in car as getting worried about time. On return to carpark, saw men at machine, asked, have you fixed it? Told, not broken was full.
Later got PCN, appealed that we did pay. Reply said you didn't pay enough. I replied to the next two letters, explaining, the instructions say, put enough coins in to cover charge (no change given), I did that. I did not realise that the last coin must have got stuck and not showed on ticket. But the instructions don't mention what to do if machine is faulty. I followed all instructions. The machine has my money, therefore there is no more payment to collect. No reply or reference to my letters. I assumed they had accepted it.
We moved house a few months later. I can't find the PCN or letters but they might be in my attic.
May 2024, over two years later, got a DCBL letter, I replied hurriedly by hand, something like, please refer to my previous letters, machine was faulty, I did pay enough coins into it. There is no missing payment for you to collect, I followed all instruction.
No reply, just auto next letter, then letter of claim. On 28th Aug 2024 CNBC claiming £290.08 with interest accruing daily. I was away, got back just in time to acknowledge online. I have 20 days left to send a defence.
Any advice gratefully received. Especially what to say and what not to say on the defence.
Thank you already to DWMB2 for helping start this .
Should I contact council and ask them if they would cancel this?
Do you think my reason might be enough for a Judge? The signage is clear, the fee is reasonable, why would anyone deliberately hold back a few pence, knowing the cameras are connected to state of the art fining systems. What else should I have done?
Should I fill in the counter claim and claim for my time? Or without proof is there no point? I have a picture of the men emptying the machine.
I have sent a subject access request to DCBL and to Euro Carparks.
Thanks so much for all the help you are giving everyone

photos are here [REMOVED BY MODERATOR]

For what it's worth, I have recently had a "victory" over DCB Legal. I followed instructions here and DCB backed out (discontinued the claim) shortly after I submitted my final defence.  My understanding is that this is what happens in 99% of cases, or perhaps in all cases.  I am happy to show you my discontinuation notice if it helps put things in context.

My advice, as someone who was in a similar position as you, would be to keep calm, follow the advice of members here, and remember that you are not up against the government or the council. You are up against a bunch of nasty cowboys who operate on the fringes of lawfulness and would rather make easy money from gullible people than do the hard work of fighting a (probably losing ) battle in court.

I've removed the link. As b789 says, be careful that you're obscuring personal info that we do not need to see (also bear in mind that your Flickr account contains your full name).