I'm not sure of the checkout system, but I assume right now that the payments are left for the sellers and buyers to deal with and Etsy would instead like to establish their own system that makes it dead easy to buy and sell with Etsy as the middle man in the transaction.

Search is hard. They have search already, but they want it make it better and more relevant to the user's taste and buying history I imagine.

Customer Service => manpower => salaries => money => funding.

Competitive wages: I'm sure Etsy pays it's employees well, but I doubt it's at market value (although it's probably damn close). But they want to take care of their existing employees and hire new ones and pay them all well, which I think is admirable.

The funding isn't absurd. Etsy can and probably will be huge. I've seen nothing from their execution and growth so far that indicates that they're a mirage or about to tank.

For a company with a revenue model, growth, and a large market to raise a 30 million series B isn't exactly earth shattering.