It seems like maybe we're getting off topic. Why does the affiliate have to suffer in order for the merchant to succeed and vice versa? The real problem here seems to be that you are giving your affiliates the same content you use on your own site. Either make them write their own content or change what's on your site and feed them the old content. It is more work, but you could start slowly by writing fresh (exclusive) content on your site for the most important products. This would give you the ability to test it out unless there is some site-wide (e.g. Panda) issue going on .
As both an affiliate and a merchant, I've always found it best if each has their own content. For one thing, the affiliate site sits earlier in the funnel so it would make sense that they wouldn't be using the same message as the merchant sites product detail page, which is about as far into the funnel as you can get without being inside a shopping cart.
If you are unwilling to do this I think EGOL said it best:
"However, if your rankings are falling it could be competitors (and your good affiliates) are working harder than you."
If you really want to be seen as the authoritative version when there are multiple sites with the same content, the biggest factor in my experience is simply links. Domain authority plays a role too, but a couple of deep links into your product page will make all the difference. I presented about some ways to get links into product and category pages at SMX West, 2012 (link to presentation) and also wrote a blog post about it here on SEOMoz. Hopefully that will help you get started, but there's no easy, scaleable way to do this that isn't a little bit on the gray side. To do it "right" in Google's eyes just takes a lot of elbow grease.
One last thing. As an affilaite there is no way I would agree to putting a cross domain rel canonical or rel author tag on my site that points to the merchant's site. You would lose any affiliate worth their weight in salt that way.
To sum things up for Gavin, here are your two options as I see it, but they aren't mutually exclusive:
1. Rewrite your descriptions and either give the old descriptions to affiliates (e.g. have a database with two different descriptions for every product) or stop giving descriptions to affiliates and make them write their own.
2. Build more external links into your product pages.