I will start off with this, as it relates directly to my original question.
It is the original email advising of the SNAD dispute:
From: service@ paypal.com.au
Subject: First Request for Information About Buyer Complaint: Case ID no. (Case number)
Date: 31 December 2009 10:54:49 PM GMT+08:00
To: (Seller's email address)
Hello (Seller's name),
(Buyer's name) recently opened a dispute against this transaction indicating
that the purchased item was significantly different than what was described.
The buyer's claim is in regard to merchandise that either was never
received or did not match your original description. Please understand that
until our investigation is complete, the funds associated with this
transaction may be temporarily held. For more information, please review
our User Agreement.
Please be aware that until we complete our investigation, we may place a
hold on funds associated with this transaction.
(Transaction details follow)
So here it is... the answer to my question, from an official Paypal email:
"The buyer's claim is in regard to merchandise that either was never
received or did not match your original description."
.... but the story gets better ... much better.