Recently, several people (mainly with German/Austrian websites) have complained that all of a sudden, some payments they were receiving from clients via Paypal were failing to be recognised by nBill (orders not activated, invoices not marked as paid). Whilst I have no idea why this should suddenly start happening, the reason the callbacks are failing appears to be that the merchant's Paypal account is set to use the wrong character encoding.
To fix this, login to Paypal, then go to My Account->Profile, click on 'My Selling Preferences', scroll down to the bottom, and click on 'PayPal button language encoding'. Then click the 'More Options' button and select 'UTF-8' as the character encoding. For some reason this does not always seem to take effect immediately, but within an hour or two it should be ok.
If your website uses Joomla 1.0, you would need to set the encoding to iso-8859-1 rather than UTF-8, but for Joomla 1.5 and above, it should be UTF-8.