Paypal usually goes with the buyer on this, don't they?
They usually go with the buyer. They go with the seller if he can give solid proof that the product was delivered. Yet, if the buyer wants a refund and the product is returnable (in this case software can be canceled or deleted) they tend towards the seller.
If you buy a product with paypal using funds from your credit card, then call the credit card company and cancel the sale, it doesn't matter if the seller wins at paypal: the seller is screwed, he can never see the money and if he made a previous withdrawal (and has a negative balance) the seller must return the money to paypal. This is the way many scammers work,
There are several ways for the seller to protect himself:
1-try for the product to have minimal cost (selling a laptop (high cost of product, high risk) vs selling e-book (no cost)
2-maybe the product can be canceled (like a membership for example)
3-check if the buyer is paypal verified (anybody can submit a credit card to paypal, they charge 1 dollar for verification on CC, then you check your charge and submit the last 4 digits - proves the credit card is yours).
4-check the age of the account (old accounts are less prone to scams, since if they scammed once they are closed).
5-check buyer reputation - (check how many verified buyers bought from this paypal member)
The item 4 and 5 I'm not sure how to do it anymore.
Hope I could help out and provide extra info.