I'm trying to create a simple paypal purchase system. Going through a few tutorials, it seems like I need to use the IPN (Instant Payment Notification) system to keep track of whether the order is paid.
Is it sufficient to use the return url variable instead, and pass in the order id? For example, something like return="http://mysite.com/paid?id=5&pass=xyS2y"
The variables - PayPal HTML Variables
No - the user might not return to your site after payment.
If you do get a PayPal return you still need to validate it just as you would for IPN in order to confirm payment went through, for the correct amount, for the correct items, for the correct payee account (you), for the correct customer, for the correct order reference, in the correct currency, with the correct shipping amount etc. etc. Your needs on this validation may vary depending on how complicated the payment you are taking is (if it's just a donation for instance that's less processing compared to say a multiple product order).
You will also need to make sure you don't double-process the order when you get the IPN through later.