The new “managed payments” system that eBay requires all sellers use (after 2021) gives the seller NO way to know what method a buyer is using to buy the item. It could be PayPal, a bank credit card, Apple Pay, Google pay, a gift card, or whatever. Ebay is the payment processor. They deduct the transaction and selling fees, and send what’s left to the seller. All the seller knows is that eBay got the money to pay for the buyer’s purchase.
If you use a bank credit card to fund a purchase using PayPal, as far as I know, only eBay gets to take a fee. Not PayPal, and not the Bank. The only activity I now see in my PayPal account is for my own purchases. There is no record in the account of anyone who might have used PayPal to buy my stuff on eBay.
This is all new since I stopped selling. This arrangement applies to those who use eBay managed payments, other than receiving directly to your PP account. I get it. Then, the PP fees are included in the expenses deducted by eBay, so you have no direct sales relationship with PP. Interesting. (I used to wait until it was enough to request a check from PP).
Is eBay management an option or required? I wonder what percentage use which.
But, with the eBay management of payments, you are correct that PP would be a pass-through, and wouldn't include those in any 1099 PP issued.