@Celia-And-KJ0 I think the issue is that when your guests book, your listing indicates that there are steps down to the beach. It's like anything on our listings- if a listing advertised that there was a pool, but then it had to be closed down for maintenance, the guest may no longer want to keep their reservation. We have to provide what we advertise.
Of course the erosion isn't your fault and there's nothing you can do about it at this point. Advising your guests was the correct thing to do, and as there is still lake access, albeit from elsewhere, it appears that it's no big deal to your other guests. This one guest has chosen to make it a deal-breaker.
So it is actually a host cancellation, as you can't provide what you say you do. That's why Airbnb is asking for some documentation of the issue. If they accept the documentation, then it will be a penalty-free cancellation for you, so you should do whatever possible to comply.
I know it's ridiculous, but that's just how it is.