You can't opt out of echeques.
Paypal only take the risk of crediting your seller in advance and then waiting for your payment to process if and only if you have a back up funding source on paypal eg debit or credit card.
If that back up card is out of date then they will wait for your payment to clear to paypal first rather than credit your seller and so it becomes an "echeque".
Its your responsibillity to make sure the card is valid but normally you do get a reminder email to say its about to expire, not sure why you did not get that.
As for your seller if it was an ebay transaction they are not allowed to refuse any paypal payment and an echeque is a paypal payment so if they refused report them to ebay....also they pay less fees on an echeque so they are daft to refuse to accept it. I would be leaving that seller appropriate feedback to reflect their breaking ebay rules.
Sorry to bring this up again...
But can an online retailer (not eBay) refuse to accept PayPal eCheques as a payment method?
I'm about to be running an automated system so I only really want those who have paid instantly to purchase from me. Way too much administrative work to follow eCheques and hold stock for the customer when doing so.
Yes i believe you can.
Its against ebay rules but if you are not selling on ebay then you can do so for paypal payments.
There is an option on one of the tabs in your paypal account but sorry can't remember which.