I think it only proves that you paid for post and not actually handed it over to the post office.   If you use paypal quite a bit tell them you will stop using the service if they keep your money (or dont use it for your stock purchases). They will lose out in the end   Maybe also put in a complaint with the financial services ombudsman. Like you say the buyer elected not to use the registered post.   https://www.fos.org.au/

What wise words. If the OP stops using Paypal they will need to offer Paymate and unsafe payment methods. In this case I believe the OP will be wasting the ombedsman's time. The fact that there is no insurance isn't the buyer's problem so be prepared to lose your money OP.