How do you pay? Why?

I usually pay with a tellers check from my credit union, unless another form of payment is requested.

As for receiving funds, if it’s a USPS MO, I just go to the PO & cash it there. If cashing a bank draft, MO, personal check, etc, I go to that bank to cash it, but if no branches are in my area, I call the bank to make sure funds are available before I deposit in my account. I have had zero problems receiving payments.

I don’t like the idea of paypal, mostly because they are unregulated and can do what they want with your money.

As a seller I like PayPal for smaller items and USPS money order or cashier's check for pricier items (say $500 or more). My bank teller told me that even though funds would be available to me immediately from my deposit of a money order or cashier's check, there was the possibility that a few weeks down the road the check or money order could turn out to be a fake and then I'd be on the hook. I asked him about the cashier's check I was about to deposit. He took one look at the issuing check service and said it was a reliable one and this check was very likely good. I deposited it and had no problems. Again, buyer's feedback and communication with you as seller is critical.
As a buyer, I like to use PayPal too, it's far more convenient and I can do it immediately rather than wait in line at the bank or PO or both before work. If the fee is not covered by the seller, or amounts to more than about $15 though, I don't use PayPal. Paying a $15 fee is about my limit for convenience. Sometimes, sellers will pay or split the fee with you though, for mutual convenience. The service really does benefit both buyers and sellers even though PayPal funds do not clear into your bank account for 4-5 days. You can just wait to ship until the funds are in your bank account. But if the buyer has good feedback I go ahead and ship as soon as the payment has been made, esp if the purchase is for a relatively small amount.
I have been lucky on both ends, as buyer and seller, following these practices for over 6 yrs of trading on Audiogon, Head-Fi, and eBay. I am the MOST cautious dealing with eBay of course. The other two sites are for extreme hobbyists and I've never yet been burned by one of those lunatics (self included).

My post office won't cash in USPS money orders because they never have enough money on hand to do it. Then my bank holds them for 5 business days... So USPS money orders are no good for me anymore.

Don't confuse 'posting' time to your account vs actual clearing. Hence CCs and MOs post immediately, but you may find out a couple weeks later that it is counterfeit, leaving you holding the bag. It is, however, not typical to see counterfeit items like these, so in that regard it is 'safer'. I always ship upon receipt of a CC, but I am still taking a chance, although a small risk im my opinion.

if someone takes paypal without the 3% fee (inexpensive items) i jump on that

otherwise I send a personal check priority mail
quick enough, efficient, easy to keep track of, and I don't have to track down a money order somewhere