Sundae; you'll still be able to volunteer whilst you are claiming Job seekers Allowance (if they decide to dismiss you appeal). You can only do 16 hours per week (I believe) and you have to be able to show that you're actively seeking work, as well as understand that if they suddenly decide to send you on a jobseeker course, or you find a job, you'll go with that.
This sort of sudden notice is unfortunately very common. Don;t be too put out by the money they are saying you owe them. If worse comes to worst, and you do end up with that debt, they usually accept ridiculously low repayments, which you can have taken directly out of your JSA benefits. You can probably argue no more than £5 a fortnight.
Still, a kick in the teeth
The problem with the medical assessments that they do for this is that it is not the doctor's job to assess if you have medical problems. It is the doctor's job to assess whether or not you are capable of work. That means any work, of any kind, for any amount of hours. They absolutely do not take into account the fact that a lot of things that render someone incapable of work aren't constant, they come and go. This means they are particularly bad at assessing any kind of mental health issues such as depression.
What this all means is actually, the worst possible thing you can do in these assessments is answer their questions truthfully and without attempting to actively skew their decision. Their default setting is to try and prove that you are capable of work. Your default setting needs therefore to be trying to prove incapacity. Every time you give an answer that might suggest that at some level they can expect you to go to work; you need to include sufficient caveats to that to give them pause for thought.
I 'played' that system for a couple of years. I genuinely was not able to cope with a workplace environment at the time. I had to play up elements of the depression I was going through and play down my capacity to cope, because otherwise they'd have thrown me in at a deep end in whch i would have drowned. At the same time, having to try and give the impression that i actually wanted to go to work (less difficult for you I'd imagine).
It's a shit way of assessing people. The more honest you are, the less likely you are to get the help you need.