Somebody from Paypal finally called me back. A nice customer support representative named "Leslie" explained the stuff I already knew; the Internet is full of scammers, they weren't sure I was going to take the money and buy $30,000 worth of Precious Moments figurines, etc etc. Once again, I explained I had absolutely no qualms with them taking the money directly from the donation account and dumping it into their relief fund.
"The only issue with that is we do not have a tie to the Red Cross," she replied. "Our donations go through United Way."
"But the donations are still going to the relief organizations in New Orleans, right?" I asked. She confirmed yes, they were. "Then transfer all the money to that fund. I doubt any of our readers will send in hate mail proclaiming their love of the Red Cross but adamant despise of the United Way." If any of you guys really hate the United Way, possibly because somebody from their organization broke into your house and beat your parents to death with a garden rake, then I guess you can join the other people sending me hate mail. Make sure to point out that I'm ugly and, in all likelihood, you're going to kill me.
So we're making progress here. The Paypal donation fund is still locked, but Leslie claims to be working on it. Thank you VERY MUCH to all websites and news organizations who picked up this story and put pressure on them to do something. Even though it took a bunch bad publicity and outraged folks on the Internet to get their attention, Leslie's polite call and desire to rectify the situation is slowly chiseling away the granite block of contempt I had for their corporation. Here's another stupid and random picture, just because people seem to like them.
The Something Awful front page news tackles anything both off and on the Internet. Mostly "on" though, as we're all incredible nerds.