When a monster attacks Reflect Bounder, the attacking player takes damage equal to his attacking monster's ATK. The defending player takes damage as normal. Reflect Bounder is then destroyed regardless of the damage calculation.
So imagine attacking it with Blue-Eyes White Dragon, ATK 3000. The attacking player will take 3000 damage from Reflect Bounder's effect. The defending player will take 1300 damage due to his monster battling with a stronger one. Reflect Bounder will be destroyed by battle.
Imagine attacking it with Sangan, ATK 1000. The attacking player will take 1000 damage from Reflect Bounder's effect, and then 700 battle damage due to attacking a stronger monster. Sangan will be destroyed by battle, and Reflect Bounder will be destroyed by its own effect.
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Reflect Bounder only ever deals direct damage with its effect when it itself is attacked. If Reflect Bounder is attacking, the direct damage effect does nothing.
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