My rule is always pay with PayPal by putting the charge on your credit card. If you have a problem, call the credit card company. They will reverse the charge.
I have done this once by going through the credit card company since PayPal / eBay was dragging their feet. And I also [amazingly] did this even though I allowed PayPal to take the funds from my bank account.
I have an unusually good relationship with my bank [Wells Fargo shameless plug] ... and they simply put the funds back into my account. PayPal / eBay sent me an email saying that my compliant was resolved. End of story.
Bottom line, you have the ability to solve these problems by going around eBay. The easiest is having PP use your credit card.
All exactly true. I do it the same. I got screwed by an unscrupulous dealer only once and was able to recoup all but $25 of a purchase that never got shipped. It was a months long process and required some work but I got my money...because of using PP and a CC.
I noticed they removed this "funding" option a while back. Lot's of folks opting to have the card issuer reverse charges.
The work around is to insist your seller send an invoice. Then the option to pay with a card reappears. You still have to look for it though, they don't make it an easy one.
Oh, and eBay/Paypal sucks.