We tested this extensively before we began our subscription program, and I can reassure you on your last point:
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(3) If I refund a payment through PayPal, does it automatically remove the user's subscription from vBulletin?
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Yes, this has been working flawlessly for me. If I refund their money via PayPal (the only payment processer we're using), they are almost instantly removed from the subscription in vB and their usergroup settings changed appropriately.