Here-in is my dilemma.... He paid by PayPal right? The evil of all evils!!
I hate PayPal as a seller for the one reason that if the buyer does not like the even just the color of the snake when they get it, they can file a claim, get their money back and you are out the snake and money- believe me, it happens. Despite all your emails and documentation, PayPal is all for handling the money again and getting 3-5 days more interest off it while issuing a refund to the buyer.
PayPal could care less about your "non-refundable" deposit policy. If you didn't ship anything they will get their deposit back if they file the claim. Your policy does not override PayPal's user agreement.
My advice is to start thinking about other payment forms..... Pop Money, MO's, etc... Pop Money is through about every bank and the fee is less than $1 per transaction with no limit. Everyone I have turned onto pop money LOVES it!!