How to save refresh tokens?
Refresh tokens are used to obtain access (this process requires HTTP Basic Auth). So, unless user has your (id,secret) combination he can't do much about it. However, storage of refresh token must be considered very seriously.
Here's my two cents:
Store your tokens in a DB
Whenever you use refresh token to obtain access token reset the refresh token as well. (Oauth2.0 has this feature, you can let the refresh token unchanged too, but it's wise in terms of security perspective to keep it changing and updating the DB)
Hope this gives some insights!!
You are correct with the attack that you describe. Refresh tokens have to be stored securely in order to be used as intended. As I understand, you are building a standalone application. Therefore, you can rely on file system security to prevent a refresh token being copied by an unauthorized user. You may want to use encryption for the refresh token, too, but the key would need to be bound to a user's session at your local machine (otherwise, the user would need to provide it during "sign in" process in order for the application to decrypt the refresh token).
Consider reading the thread from the OAuth WG, that discusses similar problems to the one described and provides some guidance: https://www.ietf.org/mail-archive/web/oauth/current/msg02292.html