Agreed. We don't use PayPal to supply or download FS add-ons, only to buy or or be paid for them. They are not assuming IP rights over your products, just assuming permission to re-use your words, pictures or videos which advertise these products using PayPal services. If you don't want a product video reused by PayPal, don't put it on your eBay advert.
Check with a lawyer if you want this clarified.