There are many pitfalls within the Ebay/Paypal empire. The thing to remember is that EP (Ebay/Paypal) will always favour the dealer, because that is where its largest profits are generated.  Even though I have 450 positive feedback any dispute with a dealer or Powerseller will be governed by the huge number of dealings they have had, regardless of the RED negative feedbacks.  Warnings about suspected irregularities to Ebay have often gone unheeded and replies are usually clouded over with official spin. They also have a very slow response time which can frustrate the normal Ebayer, while the dealer can keep on trading and cheating. The best way to get rid of a seller who has a glut of negatives is to recruit as many of the unfortunate members as you can and get them to send a batch of complaints. You may not get your money back but you will have the satisfaction of knowing that Ebay at last through sheer member power have to get rid of the duff dealer.
Ebay still  wont tell you  the outcome. The onlt way you will find out is if you access the dealers items and find a flagged up message saying that he/she is no longer registered! Ebay hate losing dealers or customers it costs them money.

Remember also that Paypal is part of the Ebay family and they also are long winded and difficult to pin down. Disputes can be very longwinded and settlements are rare.  The onus for recovery of funds is always borne on the unfortunate buyer. While I have won cases the procedure is designed to make you give up if the amount is not to large, but can give satisfaction knowing that the cheat has had to cough up at last.  I recall buying a camera from a dealer in the USA, it was my fault that I did not heed the warnings of his feedback. I paid around £100. The camera took nearly 3 weeks to arrive and quite frankly was rubbish. The description was totally misleading. Between the time I purchased the camera and when it arrived I became worried by the large amounts of negative feedback the guy was receiving. His output was huge something like 5000 dealings through Ebay and Paypal.  I tried for 2 weeks to contact him about the camera after I had eventually received it, and he simply refused to acknowledge them. Them I turned to Paypal. The outcome was favourable but it took 1 month to get my money back and throughout that time Paypal tried to make me pay them a percentage fee of the cost of the camera.  This I refused to do. I did lose out by having to ship the camera back to the USA at my cost and risk, but nevertheless it was a traumatic experience.
During this whole period and despite constant reminders and warnings to both Ebay and Paypal about the number of negative feedbacks this guy was getting they steadfastly refused to take action.  The satisfaction came when I banded together a number of his disappointed customers and petitioned Ebay against him.  Finally he was removed, though even then Ebay did not officially inform any of the petitioners they had to find out for themselves.
Finally and with the consideration that I am a fairly experienced member of Ebay the most profound piece of advice I can give to new members is DO NOT send cash, postal orders, or bank transfers. 9 times out of 10 no problems, but then the 10th one is a rogue and it makes you feel sick to think that they have your money for nothing. Paypal isn't the perfect solution but at least payment is registered and the recipient cannot deny receiving your money.