As far as I understand it you have no recourse to your credit card company with regards a PayPal transaction gone wrong. Paypal take the payment from your card and *they* pay the seller from your Paypal account; the credit card company is not involved in anyway in the subsequent purchase, thus your only point of contact in a dispute is Paypal. I'd love to be wrong but I don't think that I am.
Basically, buy with Paypal and say goodbye to all of the consumer protection built into credit card purchases.
Mark