The IPN to my knowledge has always worked as long as your setting it up correctly. You have placed the proper full url including filename of payment_verification.php in your IPN setup in paypal.com right? That tells paypal to send data to that script for processing and if done the script with authenticate a payment and post the ad.
That is where I would suggest you begin and then to test simply have two separate verified paypal accounts and try posting test ads for a quarter or so. Thats what I did when I tested this payment thing.