Originally Posted by rsek paypal does not care about digital transfers. and they can't just take away your $130 without hearing your side of the story..

Yes they can, they've been very careful not to be classed as a bank so they can do pretty much as they please with your $.

If it's a dispute, you'll likely win as paypal doesn't arbitrate digital product disputes. However if the buyer paid with his creditcard and this dispute is a charge back from that card, you are likely sol.