Paypal Removed funds from my account in error, admits mistake but refuses to refund Internet

I sold a car seat through e-bay. Buyer selected 2-9 business days, standard shipping. Terms of sale were "no returns". The buyer filed a complaint with paypal approximately 5 days later that item had not arrived. I contacted paypal to assure them that item had been sent and would arrive within time frame paid for. I was told not to worry because no action would be taken until 30 days had past and the item had not arrived. The car seat arrived within the correct time frame.

30 days later I get an email from papal saying that a reversal had already been issued because the item never arrived. They NEVER contacted me beforehand to warn me of the payment reversal or to find out if the item had arrived. I contacted paypal immediately to tell them that the item had arrived. This fact was easily confirmed as the shipping information was all filed through THEIR website.

To make a very long saga, short, Paypal sent me an e-mail saying that the payment reversal was a mistake and that the issue was resolved in my favor. When I asked them how I could get my money back, they told me that I would have to go the buyer to get it. This buyer never responded to my e-mails in the first place when I contacted her about the payment reversal. She continued to ignore my messages until I threatened to go to law enforcement.

At that point she claimed that paypal never issued her a refund. They deny this but continue to tell me that this is my problem and I have to recover the funds myself. The final offer I have from the seller is to return the car seat. I have yet to see it. In addition to which it had de-valued since then - (it was an 08 sold in 08 now the 09 is on the market). She also never offered to return the cost of shipping, so I am left out of pocket after the whole saga, whichever way it ends.

Anytime I contact paypal, they send the same message - the issue was resolved in my favor, go get the money from the seller. I feel that ultimately, they took the money (from my paypal account so I can't go to the bank or credit card to file a dispute) - it is their responsibility to return it, how and if they recover funds from the buyer should be their problem.

Cc
surfside, Florida
U.S.A.