PayPal is fine for low dollar-volume amounts and for running a few transactions per month. Their original intent was to facilitate payments for the "little guy" who didn't want to get roped into credit card processing deals that are long-term and really only cost-effective for merchants who process on a regular basis. In recent years, they have expanded their reach, most notably with their purchase of PayFlow, a web-based processing gateway. This allowed them to expand past their initial business model as a payment aggregator to an end-to-end processing solution. Sounds like, however, that they have (once again) forgotten the "little guy."
A little shameless self-promotion here:
If anyone is interested in accepting credit cards for their business or even a side business, please PM me. I own an electronic payments company that specializes in merchant processing. Prior to starting this company, I worked for 14 years for a financial institution, and one of my duties was to manage the merchant processing area. It might surprise you how cost-effective processing is. I am not a salesperson, and if I feel that it would be cost-prohibitive for you to process cards I will tell you so. In other words, I won't try to sell you something that you don't need. More importantly, I am run my customer service locally. I am located in Central PA, but can provide services anywhere in the country.
End of shameless self-promotion