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These cars are notoriously difficult to cut keys for. The only true way to get one that works is to order it through Volvo- they set up the machine with your original key codes and mill out a new key. Copying the old one that's worn too thin is usually a disaster for anybody.
The old style (240, 740, 940) keys were easy to punch out like new. The milled keys in the 760, 960, 850, S70 are a real challenge for any key shop or locksmith. However, the parts guys should recognize that they are NOT professional locksmiths and at least, the very least, cut you a second one for free. If they can't make it the second time, then maybe you have to take another tack, but at least they could have admitted that their guy might have made a mistake.
Be glad you don't have an S80. Or if you do, don't EVER lose a key for that thing. You're talking over $100 for the special security coded key and programming. Good luck with it!
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Rob Bareiss, New London CT ::: '87 244DL/M47- 229K, 88 744GLE- 218K, 82 245T-181K Also responsible for the care and feeding of: 88 745GLE, 231K, 87 244DL, 239K, 88 245DL, 246K
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