[short rant]
I've merged your new thread which contains little useful information other than a dialog you had with a PayPal tech person, to combine it with the other information already in this present thread.
Starting new threads which contain none of the history just annoys those of us who offer our time to troubleshoot problems. Please keep that in mind for the future.
[/end rant]

Also, when you write your next reply, or any new post for that matter, ensure that you've read and included answers to the "Posting Tips" section of the screen so that we have a proper context of information related to what we're dealing with on your site. Things like version numbers and lists of addons are extremely important pieces of information. We'll need that to provide further help.

Additionally, in reviewing your forum posts for the last 2 months, it appears you've been making all kinds of alterations to your site, some unrelated to checkout, and several which could affect checkout.

- worldpay callback problems
- dual pricing mod alterations
- missing fields in your database, at least in the address_book, for no explainable reason
- people abandoning orders for multiple reasons, not just because of PayPal problems
- mods broke the proper display of things like model number from your site
- mods broke proper functionality of reviews feature
- back-button problems
- various problems caused by Simple SEO URL add-on
- language file alterations have caused page headings to not function properly
- security errors on your pages related to SSL cert messages being triggered by addons and their images or javascripts

And this thread here includes a very teensy tiny little reference to a statement that indicated you've added an addon on your site which allows customers to checkout as guest.

All kinds of things in this list could interfere with the normal operation of checkout. The first, which are the usual, suspects in my crosshairs would be both your allow-checkout-as-guest addon and your simple-seo addon. Both those kinds of mods have track records of causing myriad unexplained problems in checkout.


A little background to explain some of what you're seeing ...
Your dialog with PayPal, and your explanation of the steps to recreate the problem, show that you're missing some understanding of how the Express Checkout module works. And, that's totally understandable, because most don't understand all the methods that it uses nor the ways it presents itself to customers. And, I'm not particularly interested in rewriting their 300-page manual here either.
In short there are two approaches:
- Shortcut button on shopping cart page
- Payment radio button on checkout-payment page
If the customer chooses the "Shortcut" button from the shopping cart page, they're immediately taken to the Paypal site to login and/or provide credit card information. At that point they click a "CONTINUE" button (not a "Pay Now" button). Then they're immediately returned to your store to select their shipping options and review the final price including shipping and taxes, and click Confirm on YOUR site, which then charges their PayPal account and completes the order.
If they choose the regular checkout button on your site, and select PayPal from the checkout-payment after already selecting their shipping options, then they're presented with their final price including shipping and taxes, and a continue button on YOUR site, which then takes them to the PayPal site where they login, provide a payment funding choice, and then click the "Pay Now" button to charge their account before returning to your site's "Success" page.

So, the PayPal rep was talking about that "Pay Now" vs "Continue" button allegedly not looking the way you expected it to. There's only two ways that could happen:
a) the scenario you were describing isn't what they thought you were talking about
b) your site's checkout code has been altered such that it thinks the customer is in the wrong mode and is thus presenting the wrong button
and, okay, there's a third:
c) a third option would be that some other customisation on your site is interfering with normal operation and the validations of information exchanged from Paypal back to your store are failing, causing your store to send the customer back through checkout to provide accurate or validatable information.

If you were to set up a brand new clean install of Zen Cart in a new folder and a new database, and only add Express Checkout as a payment choice, and complete a transaction, I imagine it will work properly (else we'd be having hundreds of thousands of complaints about it each day). This leads me to further suspect addons or customisations as the culprits. Determining which one, or combination of them, is a matter of trial and error, which only you can do, generally by then slowly recustomising the new testing site to match the live one, and testing regularly, until it breaks. And then taking appropriate action.