Another possibility besides those already mentioned, is that the scammers might start making recurring charges to your paypal account, as some sort of "subscription" service and still not send you anything.
My mother was a victim of such a scam, she ordered some items from a seemingly legitimate looking company's site. But the item didn't arrive on time, and the package "tracking" feature, was no help as it only showed that the package had "left China" with no more updates after that.
After emailing the company multiple times about it, they eventually sent her a "Google Translated" email, telling her to be patient because international shipping can have unexpected delays. So she waited. Almost 3 months. Further emails to them got no response at all.
Meanwhile, she started getting a monthly charge from the company. For a "subscription", that she did not remember subscribing too.
She'd had 2 of these monthly charges before she even told me what was happening, & asked me what to do.
A quick look at their site & I saw what they were up to: on the checkout page was a generic looking "sign up for our email list" option, and it was ticked "on" by default.
That was the "subscription". They conveniently left out that there was a monthly fee for being on their "email list", but also never said that it was free either. Interesting little loophole, eh?
And she was not receiving any sort of newsletter from them either. So I assume this subscription "email list" was exactly that, just a list of their customer's emails, probably collected to sell to other scammers/spammers.
On Paypal we were able to disallow the "subcription" and put a stop to that BS. I didn't bother with asking the company to cancel it, since they'd already gone silent. But I did some more investigating, discovering a trail of fraudulent behavior.
We opened a case to Paypal, including links from my investigation showing the fraudulent behavior, and immediately escalated it, explaining that we had already contacted the company & they had stopped responding months earlier.
Fortunately, Paypal refunded the item purchase, but each "subscription" fee was a separate charge & would've needed to be disputed individually. I told Mom she could do that for each one, or let them go, be glad she got the main purchase refunded, and consider it all a lesson.
And, oh yeah... Mom never received any items, just charges ... what a shocker there...
So why would a scammer want to use Paypal?
It gives many people a false sense of security -- "this guy must be legit, he wants me to use Paypal, I can't get scammed through Paypal"
Wrong! A scammer might not be able to pull the old "get their credit card number & run it up to the max" scam through Paypal, but they still come up with other ways to scam through Paypal. Paypal is not a magical, perfect, scam-proof payment method.
Even if Paypal is doing their damnedest to stop scammers & frauds, they aren't perfect.
The scammers are already working some angle within Paypal to defraud people.
Others have suggested how it might be done. Make an account (with false id/credentials) grab as much money as they can from victims, shut down the account, make a new account (with another false id) & repeat. They could be using stolen accounts or looking for accounts to steal. They could send you something that "gets lost in the mail" and try to dissuade you from opening a dispute, until the deadline is passed.
And alongside all those possible scams, they could make recurring charges to your account, too.
My bet is that they're doing a "mass marketing" scam, and they're counting on the majority of victims to: A) not be paying attention, B) not know how to open a dispute, or C) be too lazy/fed up to bother with a dispute.
For example: @Michael's comment.
I looked into making a claim... but once I saw the crap about delivery
notice I gave up. I just swore to never use Paypal again.
That is exactly the attitude scammers count on. -- "they won't bother reporting me for scamming, they'll just give up & blame Paypal"
Given that they're "selling" items at "1/10" normal price, they're likely counting on most victims deciding "oh well I got scammed, but it's too hard to file a complaint, it isn't worth it to fight over a petty amount".
Except the scammer is scamming from how many people? Dozens? Hundreds? Thousands? So even if they only get a "petty" amount from each victim, that money adds up for the scammers.
Another possibility that occurred to me is it might be a phishing scam instead of a Paypal scam. The scammers running these ads might have a "pay through Paypal" button on their site that actually opens a fake page that steals account logins, & the "super discount" items are just the bait.