This story flags bells to me. I don't know what you are selling but if I were in your shoes, I treat every transaction as one try for the buyer via Paypal. Now that you have refunded, don't risk Paypal especially given weird history.
Tell him, either certified cheque in mail and wait for it to clear or some other way. With private feedback and (bad part of town), why risk your account? Chargeback could happen, stolen funds, etc. Nope - not advisable.
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