My wife and I ordered an $800 item from someone 
on ebay.  We sent the money the day after the 
auction with paypal.  
Well, 30 days later and it still had not 
arrived.  I first contacted paypal and ebay.  
Ebay said that we could file an insurance claim 
with Lloyds of London, and paypal asked that we 
do NOT contact the credit card company because 
then they could only go after paypal.

Paypal was vey helpful.  They locked up the 
account on the seller.  They were not able to use 
paypal, or take out there money.
The fool even asked sent me an email asking us to 
release his account.  

At the end he sent out the item, and about a week 
after we got it, ;) I sent an email to paypal to 
release his account.

Bottom line....I would try paypal, they have 
gotten very good against fraud.

Hope this helps