This actually happened to me recently, as in about two months ago. I did the USPS search, but found out that the package wasn't insured, and there was no recourse after my local P.O. & carrier did their due diligence. All they could do was refund my postage fees.
I informed eBay about the whole situation, that tracking indicated that a package did arrive on a certain date, but that when I got home from work it was nowhere to be found. eBay did issue my a credit in my case, only because I had been a long-time eBay member, and this was the first incident of this type.
I suggest going through eBay. If you go through PayPal, I believe they will only require tracking from the seller to nullify your case, even if it isn't insured.
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