It doesn't make sense it would cost extra money to use my PayPal balance as payment, paying from your balance is not some major extra service that other financial institutions don't offer

Businesses can try to charge for whatever they want.

Financial institutions will always extract the most money from you as possible. It's no different for PayPal or Chase or Bob's Friendly Home-Town Bank

I get a good deal from PayPal not because they're generous, but because my transactions are very low risk and PayPal has decided to compete with other financial institutions for this class of business.

If you're getting a bad deal from PayPal on any particular kind of thing, it's only because there is little competition for whatever kind of transaction you're doing, or that they don't want that market segment very badly and are unwilling to compete for business.

My reply was just basically that they are not always fantastic and sometimes ripoff with certain fees.

I'm certainly no expert in PayPal fees however I do know a lot about how banks and things-that-look-like-banks work and can tell you that it's not personal. They will all take every penny they think they can get and the only way to avoid this is to vote for your wallet and go where you get the best deal.

I went through two other Credit Card processing arrangements before finding PayPal. They were A LOT more expensive and a lot more unpredictable unless you had a team of CPAs watching your business and credit card processing.