We use Google Checkout for our Capital Campaign and it has been very successful. About 35-40% of our money donated comes from credit cards. When we signed up they had a deal to be able to use it for a year with no fees. I don't know if they are still running that promotion.
Are there any PTO organizations out there that use a paypal account for fundraising? It seems like it would be a great thing for out of town family and friends...an easy way to sponsor a child for a walk-a-thon or something like that?