When I buy gear I don't mind paying the extra 2.9% PayPal fee. I look at it as a big time saver - I don't have to stand in line at the bank, pay the fee for a Cashiers Check, then stand in line at the Post Office, find change for the parking meeter, pay to insure the package and pay for postage. And then wait in Agony to hear back from the seller once the funds are received.
Instead, I sit in the convenience of my office - log on to PayPal and just hit "send money" and its done.
Of course there is a value curve with PayPal use. If I am purchasing something which costs more than "x" dollars, I consider if it would be more cost effective to spend the time and energy to get a cashiers check and mail vs. absorbing the PayPal fees.
Guess it depends on how much you value your time.
For purchases under $1000 PayPal's 2.9% fee is a relatively "fair" price for the service - given the alternatives.