Good news – the Paypal account is restored.
I would like to think that the big social media fuss wasn’t necessary and this would have been happily resolved quickly anyhow, but I somehow think it might have been more to do with the large discussion on reddit, all the Tweets, and the 220,000+ hits we had on the blog post. I am happy though about the outcome 
Thanks to everyone for their support.
Here is the email.
Dear Julian Wills , Thank you for contacting PayPal regarding the recent limitation of your PayPal account. We have further reviewed your case and determined that your account is currently not in violation of our Acceptable Use Policy. As such, the limitation on your account has been lifted. We sincerely appreciate your business and offer our apologies for any inconvenience this disruption in service may have caused. In the future, if you have any questions regarding what items are prohibited under PayPal's Acceptable Use Policy, please see the following URL for the complete text: https://cms.paypal.com/us/cgi-bin/?cmd=_render-content&content_ID=ua/AcceptableUse_full&locale.x=en_US Again, we thank you for your cooperation and understanding in resolving this matter and appreciate the fact that you chose PayPal to accept payments for your business. If you have any further questions, please contact the PayPal Brand Risk Management Department at euaup@paypal.co.uk. Sincerely, Zoe PayPal, Brand Risk Management