There are definitely some bad stories but I think they have cleaned up their act ever since Ebay bought them back in 2002 (I think).
But I run my business online and use paypal as one of my payment options. Nothing bad so far, knock on wood.
It's easy to set up as well. Their website is pretty user friendly for the most part.
If you are going to be a larger ecommerce website get a merchant account and accept all major credit card, just include paypal as one of the options. If you are a small shop, paypal makes sense for a lot of people.
I was always leery about using paypal exclusively for my site. But make sure you read all of the PayPal's Seller Protection Policy and understand it.
Their is a website called paypalsucks.com but I write most of it off. What big company doesn't have a blahblahsucks.com site anymore? Anyway just things to look out for but overall, I like it, it works and my customers that use paypal are happy because it's an option.
Good luck!