I hate to say this, but you are now in the hands of PayPal, and they have very strange ways of dealing with problems, in relation to complaints or disputes.
Normally when you put in a complaint or dispute, eBay transfer the administration of resolving the problem over to PayPal, if they made payments for you. PayPal will try to obtain a refund from the seller's account, and if the seller's account is closed, due to lack of funds, then direct from the seller. It's a long drawn out method, hence the 30 days. In the end you may still be on a loser, due to PayPal's administration charges, and complicated way of dealing with matters.
You say that you informed the seller and the bank to stop payment, "this they did". What do you actually mean?... If I suspect that PayPal are owed money, then this can get further complicated, and PayPal may hold you responsible for payments, they have previously made.
Sorry to not be more implicate, but things can get very complicated, in an action like this. If you still have the copy of the software, then perhaps contacting the manufacturer/distributor may help, as this could result in them taking action against the seller. eBay should be fully aware of possible infringements of this software, due to their removal procedures.
If this all sounds confusing, then come back for further help and advice.