You have received some exceptionally good advice here. Without repeating what others have said I will just add a couple of points. Always do what will protect YOU not what suits the buyer. I would not have posted them in an envelope, it is very easy in such a situation to acquiesce and this is now, as you know, what happens! Some buyers are just a nightmare and your radar should have been waving madly by the time you got to this point with them. Ebay may well have removed any negative feedback had they asked for and been denied something which was not offered in the listing - in this case the cheaper method of posting.

Secondly, PayPal WILL accept a receipt showing the date of postage and the postcode as proof of post, I am not sure if you still have the A.P. receipt but this will save you if it gets to that. Hopefully it won't.

Come back if you need further advice and happy new year.