Hmm. It is a fair amount. 3% = over £100.
Yes, but you’ll still pay c.1% through an FX house.
Paypal use a ‘retail rate’ and unclear what that is. They’re operating in a murky world as they’re verging on being classified as a bank given the amount of customer deposits they hold. I suspect their rate is similar to what you would receive from a bank whilst they will be trading at close to spot so they make a nice turn. Gift a euro to a mate and see what rate they give you? Post the time and date you do so on here and i’ll give you spot at that point if you want.
Besides, what happened to your £2k budget?!