Sadly the bank wont do anything until the transaction clears with Pay Pal, because they assume you'll dispute it with them first and it will get reversed that way. What I'd do (and Ive dealt with Bank of America before on similar issues, it isn't easy!) is go to your branch and pick up dispute resolution forms that way you have them in case Pay Pal doesn't take action. If paypal does take action, but bank of america still hits you with fees AFTER the original transaction is reversed, dispute the overdrafts as they wouldn't have happened if they would have taken action in the first place. I never dealt with B of A on the phone and gotten anything done, again go to your branch and talk to someone in person. That usually clears things up, especially if you demand to see a manager .
Follow up with paypal too, find out when the transaction was made (what time of day, when/if there was any log in requests from YOUR IP adress, ect) and if its some sort of subscription service. I know they've had problems with random subscriptions being taken out of accounts. What you've done on your end seems ok as far as making sure your account isnt messed with again but I'd hit up paypal for as much information about the transaction as possible. This will help with the bank later, if the bank decides to be a bunch of jerks.
Hope this helps!