I had this with our buggy.
Pickup in person ONLY and cash on collection literally festooned all over my item listing. I had heard about too many people getting scammed over couriered buggies, from mumsnet threads.
I returned the paypal and said local pick up only, cash on collection. She offered to send the cash by courier. Told me 'all' I had to do was put the thing in a bin bag and wait in for a courier! I work!
She threatened me with bad feedback and I said go right ahead, I will respond that the item was local pickup only and you are 200 miles away demanding a courier.
Ebay were brilliant, I put a dispute in, they could see my original listing, and I got the transaction cancelled no probs. Some people bid on local pickup only things if they are cheap - local pickup stuff often goes cheaper depending on your area.
Sod waiting in for couriers or packing up stuff when you asked for local pickup. Stick to your guns, refund the money and put in a request for the item to be cancelled.
12thmonkey, sending a courier is very different from arranging collection in person. I wanted the buyer to SEE the item and agree that it was what they wanted and in the condition they expected, before removing it. You can't do that with a courier and then you might end up with all the faff of a buyer saying 'item not as described' etc.
In the end my buggy went free to someone I heard about having an unexpected 4th child after a long age gap. She was very grateful!