Of course I can only speak from my own perspective... and I know things have changed since I was a little girl accompanying my parents when my father had seen something in the Trading Post. I vividly remember that whole sense and atmosphere of buying on trust, and rarely being let down. Money would change hands when picking up the item and approving it in person, so there was none of this SNAD business. (But of course this was for face-to-face transactions.)
Fast-forwarding to now, we live in a world in which PayPal has enmeshed itself into auctions and online purchasing... and I can see that PayPal and Paymate and Google Checkout and so on are some of the few methods that enable private owners of things world-wide to be able to buy one from the other. I still prefer using my card for online purchases from businesses; I can then deal directly with my card issuer (bank) if there's a problem, and the merchant is the person who sold me the goods. There's no middleman - no PayPal in the middle. If I make a claim, it's against the seller, not PayPal - if I use my card. This means the seller gets the necessary information to reply to any problem... It also means I am comfortable in the protection my card affords me.
For businesses, I honestly find PayPal as the ONLY payment solution off-putting. (vPost, for instance, ONLY offer PayPal, and it surprises me every single time. I think I deliberately block it out - every single time!) I always appreciate it when a seller has various payment options.
Wheels, you might find in the long run that offering those options brings you more business, as some people are so very opposed to PayPal that they'd rather pay by any other method. It might cost a little more, but it's possible those fees may come down in the future if Paymate gains more ground.