I cannot refund money because PayPal do not want to get my account on negative balance when I want , they will when they want and that's exact moment when OP get his money back. Anymore discussion about that is irrevelant.
I don't see why paypal freezing your account has anything to do with the OP. You wanted to be paid for BTC through Paypal. He paid yu through Paypal. Send the man his BTC, scammer.