What to do when a company totally misleads you in regards to a salary negotiation issue?

I was offered a new position in my company but declined due to the salary they proposed. I explicitly stated the salary I would need to accept this position verbally. I was told to fax the reasons I deserved this salary to them but instead I emailed this to them in a very clear letter stating I would only accept this position for the specific salary I wanted. I was told by my previous boss that they accepted my offer and to start the new position immediately which I did. When I received my paycheck, I realized not only did they not pay me what I wanted but they did not increase my salary at all. They explained that my new boss received an email saying they would only pay what was originally offered to me but this was NEVER told to me ever. This salary was the original salary I declined. Now they tell me my previous position is no longer available. This new position entails alot more work, time, driving and involves me working with a boss who simply does NOT like me. What should I do??? Can they really just say “sorry for the confusion about your pay”?