Hi purbeast0,
You could be running into a risk model denying the specific transaction. It is just a guess based on the post.
Choice of Funding Sources. PayPal reserves the right to limit an account-holder's choice of funding sources for any individual payment based on analysis performed through proprietary risk modeling systems. When PayPal decides to limit funding source choices, the account holder will be alerted to the higher-than-normal level of risk associated with the payment. If PayPal determines that there is a higher-than-normal level of risk, this is not an indication that either party in the transaction is acting in a dishonest or fraudulent manner; it is merely an indication that the combination of variables in the transaction has alerted PayPal that the potential for payment repudiation is unacceptable. The account-holder may choose to continue with the transaction using the available funding sources (if any), with the understanding that he or she may be accepting an additional level of transactional risk. Thus, the account holder may have fewer avenues available for dispute resolution should the transaction turn out to be unsatisfactory. For more information about protecting yourself from the risks associated with online transactions, please visit PayPal's Security Center.