I'm hardly a veteran, but I do sell stuff on ebay so....
In my postings, under payment information I indicate that payment must be received within 12 days or negative feedback will be left. That gives the buyer a timeline (I'd hardly be difficult about it, if communication was satisfactory) and me an expectation. Not sure if your auction had that information or not Scott. If not, you sort of left yourself open, but not for an exceedingly unreasonable period of time.
Think of payment in the mail. Letters (money order or whatever) usually come quite promptly, within a week from US to Canada, so presuming you told him last Tuesday, it's only been a week. Letters can take longer, up to and over two weeks, so I'd still be patient.
Sounds like you've got one of the classier
ebayers to deal with. I've been fortunate most of the time to deal with really good folks that actually email back and forth and have some understanding of time and lives. This person may not be like that. He may have sent payment though, and not been considerate enough to tell you. I'd wait a while for payment, send him another email outlining your concerns politely and see what happens. Give him a deadline for the payment to be in your hands so he has a timeframe as well.
About paypal and the buyer....If you didn't list it, too bad for him. I often don't bid on auctions that don't include paypal, but know DSJ will be the exact opposite if the auction is paypal only. It doesn't matter what the buyer wants to do unless that option was available to him and you refuse it. In this case you indicate paypal was not listed, so he's out of luck and should read more carefully.
worst case scenario you leave negative feedback for him (and likely get same in return). You can give a second chance offer to the next highest bidder, if you're satisfied with their bid amount. Sometimes they take it, sometimes not.
Or just take Josh's advice.