its covered by Australia Post if its registered isnt it ... upto a $100 or more if you have paid extra ....
but if paypal did have an actual sellers protection in place then you are correct according to the rules if they pay as seperate transactions then they should be sent as seperate parcels
see here
http://help.ebay.com.au/Education2/PayPal/About_PayPal/FAQs_-_advanced#a7in particular ....
What’s not eligible?
Local pick-ups or deliveries made in person
Digital goods, services, or intangible items, quasi-cash, gift certificates, downloadable or streaming content, licenses for digital content or motor vehicles (including cars, motorcycles, boats, and planes)
Claims that items are significantly not as described
Unauthorised reversals or chargebacks for items not sold on eBay
Multiple eBay items paid for through separate PayPal payments, combined into a single shipment More than one payment for a single eBay transaction