Have you turned on logging for paypal,
Im not sure where to find this - sorry
have you checked the /cache folder for error messages
I have checked for the errors and this is what i get when people cannot complete their Paypal payment (well some but not all)
[23-Aug-2011 02:45:21] PHP Warning: require(includes/templates/template_default/templates/tpl_wp_callback_hacker_response_default.php) [<a href='function.require'>function.require</a>]: failed to open stream: No such file or directory in /home/cakekraf/public_html/includes/templates/modern_black/common/tpl_main_page.php on line 125
[23-Aug-2011 02:45:21] PHP Warning: require(includes/templates/template_default/templates/tpl_wp_callback_hacker_response_default.php) [<a href='function.require'>function.require</a>]: failed to open stream: No such file or directory in /home/cakekraf/public_html/includes/templates/modern_black/common/tpl_main_page.php on line 125
[23-Aug-2011 02:45:21] PHP Fatal error: require() [<a href='function.require'>function.require</a>]: Failed opening required 'includes/templates/template_default/templates/tpl_wp_callback_hacker_response_default.php' (include_path='.:/usr/lib/php:/usr/local/lib/php') in /home/cakekraf/public_html/includes/templates/modern_black/common/tpl_main_page.php on line 125
I honestly don't know why IE7 would give a problem, how sure are you that it is only IE7.
Im not 100% sure, but the few that had replied said they were using IE7, but they maybe wrong.
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When people say "broken in IE7" what are they meaning, is the layout effected or is it just the paypal not going through