ActiveMerchant::PaypalExpressGateway does nothing with item[:sku], instead we should set the confusingly-named item[:number] from the underlying Paypal api: https://cms.paypal.com/us/cgi-bin/?cmd=_render-content&content_ID=developer/e_howto_api_ECCustomizing

app/controllers/spree/checkout_controller_decorator.rb

@@ -184,7 +184,7 @@ module Spree
           fire_event('spree.checkout.coupon_code_added', :coupon_code => @order.coupon_code)
         end
       end
-      
+
       load_order
       payment_method = Spree::PaymentMethod.find(params[:order][:payments_attributes].first[:payment_method_id])
 
@@ -240,7 +240,7 @@ module Spree
         price = (item.price * 100).to_i # convert for gateway
         { :name        => item.variant.product.name,
           :description => (item.variant.product.description[0..120] if item.variant.product.description),
-          :sku         => item.variant.sku,
+          :number      => item.variant.sku,
           :quantity    => item.quantity,
           :amount      => price,
           :weight      => item.variant.weight,