warning paypal problem

PayPal should now charge him with fraud and you charge him with theft, other than the hassle. Their judgement in your favor basically implies their belief in his guilt.

In any case, good for you.
Remember, PP is not a law enforcement agency, they are a private corporation. They would have to call the police and file charges. PP, I'm sure, kept transaction fees from the "theif", so they made money on the deal. Steve got his money, so there is no theft at that point. The folks involved are really only out the time and aggravation it took to resolve the issue. However, we all now know there is a shitty shyster out there.

Glad you got your money, Steve, and glad to see PP step up and protect an honest seller.