From the Wordfast site (the formatting is mine):
The discount price is made available to buyers who work and reside in countries where most people cannot afford standard prices of software.
Hence, it does not apply to users who work or reside in any of the following countries or their dependencies:
The Americas: The USA, Mexico, Canada.
Europe: Andorra, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Liechtenstein, Luxembourg, Monaco, Portugal, Spain, The Netherlands, Norway, Sweden, Switzerland, The United Kingdom.
Asia/Oceania: Australia, Brunei, Hong Kong, Japan, Korea, New Zealand, Singapore, Taiwan.
"Near East": Bahrain, Israel, Kuwait, Qatar, Saudi Arabia, UAE
Important: the origin of payment is taken as evidence. Sorry, no exceptions.
I am failing to see why paying your Wordfast licence through PayPal would not make you eligible for the discounted price. I think the information stated in your PP account is evidence enough to determine the country of origin of the payment.
I would contact the Wordfast support to clarify the matter. Maybe the Wordfast site also works in a way that blocks fraudsters from buying the software at the discounted price (e.g. through an IP check or similar means).
[Edited at 2009-07-18 16:24 GMT]