I would be asking PayPal a couple of more direct, pointed questions. More particularly because they sent an email saying they couldn't verify shipping information, but have now admitted they didn't make any effort to. 

The first being - is this transaction eligible for seller protection? If they say no, ask why not. At least then you will know 100% where you stand, and get some clarification on the issue concerning digital goods.

If they say yes, ask why your evidence of sending the goods was neither taken into consideration before deciding the case, and why it's not providing you with said seller protection now. If the answer was yes, it's elgible and their response to this is unsatisfactory, advise them you will report the incident to AFCA (Australian Financial Complaints Authority).