I Have brought a number of cars and bikes on ebay and hope to give you the benefit of my experience!
On more than one occation I've been disappointed with my purchase but have not been in a position to get a refund. I buy and sell bikes and cars as a hobby, normally buying on ebay and selling privately. There are obvious things you can do to protect yourself and some not so obvious. I'll try and outline the points below.
1. Were possible (if it's not to far away) view and test drive the vehicle before buying. If the owner won't let you drive ask to go for a spin with him. You can tell alot about a bike or car as a passenger if the car is driven the way you want. If the owners driving ask him to get up to: a)70mph on a motorway, b)brake hard, c)turn aggressively, d)hill start (clutch and handbrake). If none of these test make sense to you take someone with you who knows abit about vehicles.
2. Check the history. In person if you go for a viewing if not ask about the history before bidding.
3. Always do a HPI check or ask the seller if he has had the vehicle checked himself. I learnt this the hard way and it cost me over £800.00.
4. Ask specific question about the vehicle. eg Don't ask if the body work is ok, Instead ask if the vehicle has any dents scratches or rusty areas.
5. Check the sellers history. If they have sold vehicles before don't just look at the feedback ask 3 or 4 of the people who left feedback if they are still happy. Remember with a vehicle you may think you have a bargin but at the next MOT 3 months later it may come to light that the car has some very bad problems, so with a vehicle positive feedback a week after the purchase isn't the be all and end all.
6. DON'T PAY UNTIL YOU HAVE SEEN THE GOODS. You can still use Paypal if you wish just ask the seller if you can use there PC and instruct the payment from their house once you've seen the vehicle. Remember to hide your Paypal password and to change the password when you get home.
7. This is probably my most useful tip. Send the seller an email asking if there is anything other damage or faults you should know about the vehicle. Once you are satisfied email him this, paste and copy if you like. I have read your discription and asked you to declare any faults or damage. I've kept a copy of all the faults and damage you have declared. I will be bidding on your vehicle on this basis but should I find any further fault or damage I reserve the right to with draw from the purchase. Is there anything else you would like to tell me before I bid? This statement sorts the men from the boys. If the guy is geniune he will either declare more faults or agree. If you don't here from him DON'T BID.
8. Never view or buy a vehicle in the dark. I lost a few quid on this one too. I once brought a car in the dark and drove it home only to find it had the passenger door replaced with the wrong door. Total write off, I was not happy!
9. Don't be to keen to leave feedback. Give yourself a few weeks of driving first.
HOPE THIS HAS BEEN HELPFUL!