Is it possible and if so how to do an IPN transaction within a facebook application?
I found you can not launch an IPN transaction within an iframe. I will be using facebook's iframe option for my application, so I need to figure out a way for the users to pay.
I guess it would be possible to launch a pop up with the transaction in there... but then there is the risk of pop up blockers etc.
How do developers normally receive payment?
If you are looking to do simple micropayments (such as for virtual currency in a facebook app game) you may want to consider a 3rd party API such as SocialGold (http://www.jambool.com/)
SocialGold supports an iframe option by using a signature passing method and handles a wide variety of payment types, including PayPal.
If you want to avoid the risk of a popup blocker, consider instead using the iframe within an inline dialog within your application. There are many dialog handlers, but I recommend one that relies on JQuery myself: