Yea, the margins went from out-of-this-world to terrible as the price of new laptops came down. We used paypal and a few other (way worse) credit card processors. We also accepted checks and money orders by mail.

Edit: Another interesting tidbit. We were such a large paypal customer at the time that we were invited into their IPO. Bear Stearns (I think) called us 5 times trying to get us to buy in...but it was right after the .com crash and we chickened out. We would have doubled our money that day ;(