Reduce chargebacks using paypal trading of virtual goods?

The note doesn't really matter to Paypal. If the person disputes the charge in virtual good trades like this, the person will most likely get the refund. The payment for good/service option can be easily disputed since there's no tracking info. The friend/family option can also be charged back if customer service is contacted.

I heard when the note is "gift" that may be advantageous to the receiver. But I don't know if it actually means something to paypal or if it is just an internet myth.

yup its risky, if theres a safer way I would like to know as well

If there's a chargeback, you could always report the account as hijacked. You'd most likely be able to get it back. (Make sure you have enough information to retrieve the account before you sell it.)

I've never done this but I've been thinking that if you ask them to include a note that says "loan repayment" or something like that it might help combat a dispute.

Also if you're outside the USA you might try transferring the money by pokerstars.

I haven't tried either of these but I think they're worth looking into.

The only way I can think of to protect yourself would be to pull the money from the Paypal account once you get paid, make sure it is deposited into your bank account first before giving the person 'the goods'. You would have clarify upfront to any potential buyer that this is part of your selling guidelines though.

Simple answer: don't use PayPal. Give the buyer your bank connection information and tell him to deposit the money in there. If you're in Europe, you need to give him the IBAN and SWIFT numbers that he will use to send money to.

Another option is a money order. You do that in the post office; he pays there, you get to the post office and get the money. This is as good as cash; chargebacks are impossible.

Use Bitcoin or make him get Moneypak for Paypal