from a buyer's perspective, it seems to work quite well.
I've had an account with them for a fair while,
but have only just started to use it.
I won a few auctions from E-Bay, and used my Paypal
account to pay for them. I have my credit card linked to
it, so the money just goes from that.
As I understand it, when someone pays you money
wih the paypal account, Paypal then send you an e-mail saying
that you have some money to collect.
I think it gets deposited to a bank account or whatever you
decide to have it paid to..
They've just updated their user agreement, so that may shed
some light on the situation.
Try their homepage for more help.
Hope this helps!!