G'day SeldomFixit,
I've done a bit of buying and selling on EBAY and have been pleased with the results.
WRT your question about Paypal, another method that works well particularly if selling within Australia is good old bank transfer. If both you and the purchaser have access to internet banking then it is p1ss easy. When the auction is over and the buyer contacts you. All you need to give him is a BSB and acct no and it's done. You can then check your account and send the item when you have received the payment. Some people might have different ideas about the relative security of giving out this info but from my experience so far, it has worked well.
Packing up and shipping shouldn't be too much of a hassle. For smaller items you can figure it out on the Australia Post website. Any larger items requiring a shipping company can be priced by calling the company with the dimensions, weight and description. They will usually give you a price straight away over the phone. Under the Ebay rules you are entitled to add packing, shipping and handling costs.
It's all good fun really and for those who haven't had a look there yet, you'll be surprised at the stuff you can find.