You fail to account that this story is representative. They only got it resolved because of the increased media attention on this particular story. There's many, many more out there where people have been screwed over by Paypal.
The very idea that because you only hear about a "few" stories excuses the fact that these are basically unchallengeable is crazy. Couple that with the idea that it shut down the recipient's account too and it's wide open for abuse with many people who will never be able to get media attention and thus a resolution to the problem.
They'd more likely just increase the price consumers pay for goods while eliminating competition from the market place. I also have a hard time imagining such a thing would not be filled with loopholes that a large corporation could take advantage of for themselves while also using it to prevent competition.