Please follow the procedure to apply for the discount:

Step1:  Go to live.com, do a product-oriented search and you'll see a sponsored link for the program.  Click that and register for the cash back program. Make sure to choose paypal as your $ system.

Step2:  Go BACK to live.com and do a search for a product (xbox games works as of this writing).  You will see an eBay.com paid-search advertisement that has the cashback coin icon.. 

In the eBay-sponsored ad, click the Live Search cashback link. This brings you to the eBay.com site with your search terms already in the eBay search box.

You see the first two steps below:

You'll know you've done this right if when you get to eBay it is splattered with live cash back icons and banners on the top and down the left side, like this:

Important: Your cashback rewards offer will be good for 60 minutes from the time you click the eBay sponsored advertisement that has the Live Search cashback icon next to the advertisement. You must successfully complete an eligible purchase on eBay.com using “Buy It Now” and PayPal within 60 minutes of clicking the ad.

Step3: Read and make sure you understand the eBay terms and Microsoft Service Agreement.  

Step4: When you go to the item page, your cashback rewards percentage is shown at the top of the eBay page. When you find an eligible item you want to buy, click the Buy It Now button. On the Order details page, you’ll see the cashback total for this purchase.

Step5: You will be sent an email via mymessages confirming the deal!