Calgirl, the only thing I think I would do right now is refund their PayPal payment (that's how they paid, right?) and have them pay either with a USPS money order or cash in person.
The reason is an unscrupulous buyer could file Item Not Received after they've picked it up because you've got no proof of delivery -- which is all Paypal wants to see. Then they'd have the item plus their PayPal-forced refund.
Although if accepting PayPal is in your terms then they could also file a dispute if you change those terms. But even if they did at least there's no chance you'd be out $120. And if they're picking it up in person it doesn't seem like it'd be a problem to pay in person...