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They can only transfer dollars if you can set your paypal account to receive dollar payments. (You can add a currency as you can accept more than one currency).
You will have to then convert it to sterling in your paypal account incurring currency conversion charges if you want to transfer it to your bank account.
If you look in your paypal account on the line where your balance is look to the right and click on the word currency conversion > in there you can add a currency. I think in there is the currency conversion fee table as well but not sure as it changes daily.
Thanks Kernowlass I presume in Cornwall ?? As am I.Not using dollar account and want to transfer to my sterling account.Will try as you suggest.Thanks