Sorry, this isn't a reply, but I'm just subscribing to this topic because I am having the same issue. I've even removed and re-added my PayPal details and it fails for any amount I try to buy.
Edit: I have some more info. I was originally trying to buy L$25,000 and it failed. I tried 20K and it failed. I tried 2K and it succeeeded. I then tried 15K and that worked too. But trying to buy another 15K after that failed. I think there is some maximum daily amount per day being put in place by LL or PayPal somewhere along the line, but the email doesn't explain the reason.