The next day the decision was reversed as the seller had provided a photo of the parcel addressed to me, along with a receipt which simply had my postcode on it as proof of lodgement. I was out of Pocket $125, no item and Pay pal sided with the buyer and I lost. I fought it and a week later I still lost.

And did you ring Paypal, ask to speak to a supervisor and tell them that you would provide them with a Stat Dec confirming you had not received the parcel and if they still did not refund tell them you would be complaining to the Ombudsman?

I am 100% sure that had you gone down that route you would have had your refund.