So today i used paypal for the first time i shipped an expensive item to a man in california now im being told that even tho i entered the tracking number that my funds are on hold for 21 days so what is to stop the buyer from canceling his payment right now and stealing from me how exactly does this system protect the seller shouldnt i get my money as soon as my item has shipped!
The pending status is between you and paypal and the buyer has nothing to do with it.
The buyer can't cancel a payment that is pending in your paypal account as it would show as completed on their side.
The only way a buyer can get a refund from you is to open a paypal dispute for non receipt of item OR item received but not as described and IF they win then you would have to refund even if those funds were already in your bank account.
Your best bet is to actually go and read up on paypal seller protection so you can risk assess your own transactions.