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Has anyone ever been able to be refunded for something they paid for using friends and family and it was actually a dodgy seller
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A friends / family (or gift payment) is intended as a transfer of funds from family or friends to one another. For this reason, there is no processing fee when payment is made with bank or PayPal balance.
However as it is a gift payment, there is also no buyer protection as no goods or services should have been exchanged.
If he was not a close mate or family member you should never use that option as it enables the seller to evade paying his Paypal fees and negates your buyer protection at the same time.
You would also not be able to open a dispute (apart from one citing an unauthorised transaction), which would be automatically closed as you did authorise the initial payment.
Be careful as using that option for purchasing goods is against Paypal rules and can lead to account limitation.
If you funded your Paypal payment via a credit card then contact your card issuer and see if they will help you but unfortunately they may decline as well as it was a gift payment.
Advice is voluntary.
Kudos / Solution appreciated.

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