After all these years, 16 for me in the hobby, there is still a lot of ignorance regarding PayPal Friends and Family.
This is exactly how it works:
First of all you are committing Fraud if you send or receive a Friends and Family payment with someone you don't really know.
If a payment is sent through PayPal Friends and Family, the buyer can no longer file a dispute through PayPal, and if the buyer used funds from within their PayPal account you are totally safe.
However, most of the time the buyer funds the payment with a credit card or bank account, and in those cases the buyer can still file a dispute with the bank or credit card company. With credit card companies the buyer has up to 6 months to file a dispute, and with banks the buyer has up to 2 months to file a dispute depending on the bank.
Once a dispute is filed, the money will immediately be taken from the Seller's PayPal account, and the seller will then be given an opportunity state their response to the buyer's claim. In 99% of the cases they will side with the buyer, so the seller should plan on losing their money regardless of how ridiculous the buyer's claim may be. If the seller already spent or transferred the funds away from PayPal, PayPal will then go after the seller's bank account on file, or attempt to charge it to a credit or debit card the seller has on file.
In the end if this happens to you, expect the money to be taken away (never to return), and your pinball machine to be stranded far away in another state (with you having to pay shipping to get it back). Thankfully this has not happened to me, but I know a few people that have had this happen to them.
The moral of this is, do not take PayPal Friends and Family payments from someone you don't know.