You can also steer clear of Paypal all together if need be, some buyers do it. If I honestly feel someone is legit about wanting the account but circumstances prevent me from verifying who they are, I give them the option of sending the money through Western Union.
All of the above posts hit the nail on the head for steps to take.
Speaking of that, as I've been selling on ebay for some time now, I need to get TWV myself for MD. I only rather recently stumbled across this site as a tip from a past buyer to increase business.
Another option, if you're selling a loaded account that's worth a lot of money. Use a verified middleman business. I personally use playerauctions.com for such accounts. However I understand MD has their own now, realitybridge.com or something along those lines. I can't comment on it as I've never used it, but trust me, these services make everyone fill at ease.