Ahh, yes, it's coming back to me. I'm using a dynamic IPN URL, that's why you have to leave the field blank. The URL should be getting passed as part of the API call to process your PayPal payment. This should be safe for Clean URLs or not. It may be that the IPN just wasn't turned on before? Erase that field in your PayPal profile and try again if you don't mind.

Also, which PayPal service are you using for these tests?