I think, as jaydisc, points out, that it comes down to an insistance on using Express mail, which then covers them if there's a PayPal scam (which happens) - they're not covered if they use the untrackable, regular, First Class Air. The problem with First Class Air is delivery can't be confirmed - so if a buyer claims the item didn't arrive and demands PayPal protection, there's no way to check if it's a legit claim or a scam.
These guys are running businesses and I guess have decided it's worthwhile for them to outprice some international buyers rather than risk PayPal scams.
It's a little silly of PayPal, since it shifts a huge cost for that coverage to the buyer - in the case of small items we're looking at the postage tripling. And since the shipments need to go to the PayPal address, international buyers can't use a proxy address (although I guess a US based friend couled buy and then ship on, regular mail). A better solution would be to incorporate a fee at the buyer's end (say a $1 fee if 1st Class Air is used).