We did try PayPal last year and didn't have a whole lot of activity. One problem we ran into is selling raffle tickets (not allowed per PayPal, but I hadn't read all the fine print). I just came across a new site caleed We Pay, which is geared around collecting money for groups specifically. We are giving that a try this year to see how it goes.
We have the option, but mainly use PayPal to allow credit cards at our auction. We set it up a few years ago as a business account and sent them our 501(c)(3) when we got it to get a lower rate (2.2% instead of 2.9%, IIRC).
One nuisance we had to work past: at the beginning, we were limited to transferring $500 or less per month to the PTO bank account. Our auction brings in $000, so this would have taken months, and we weren't looking to pay for field trips by PayPal. In order to raise the limit, they wanted either my SSN (hah!) or a major credit card (which probably gave them access to my SSN anyway, now that I think about it ...). I guess it's to prevent money-laundering or something. They would not accept the PTO's EIN. I ended up giving them a credit card, which I cancelled later.
I have a couple custom donate buttons, where the user can click and get taken to a "checkout" page. It seems PayPal discourages users from paying without an account; it's hard to get the page that allows payment with just a credit card number.
We did for our Project Graduation site. We had donations, ticket sales to a dinner, and ticket sales for the Project Graduation event. In the 7-8 months we had it up there were may be 6 total transactions. But it was an interesting experience and it was nice to say that the option was there to use credit cards.
This was a simplistic use of PayPal. I haven't bother to inactivate the pages, so you can actually see ours if you like. (Go to the old post.)
For the tickets we added a $1 surcharge to help defray the transaction fee. I couldn't find a way at the time to have it as an add-on charge, so we just explained it on our website. If the ticket was $25, the PayPal cost was $26.