If you have a fresh new set of checkout pages this should be a good start. There are many posts in this thread and it is very difficult to keep a single conversation going for so long when there have been so many changes along the way. Let's keep this as the starting point so that we do not have to refer to any of the previous posts or it will take more time to resolve the issue.
With a newly created set of checkout pages with Payments Standard selected you should be able to process a transaction successfully so long as the details used in the checkout wizard are correct. When you select Payments Standard you will have the option to include Express Checkout. This is the option that you see at the top of the checkout page with the PayPal button. When you have the Express Checkout option selected when running through the wizard it will create the set of pages that you need to use Express Checkout. The pages are pp_confirm, pp_checkout_success and pp_checkout_failure. These pages will make use of the PayPal API signature, username and password.
When the user selects this option they will go to PayPal to login, then be returned to the pp_confirm page. From here the user can confirm the order then the transaction is processed and if it is successful the user will go to the pp_checkout_success page, and if not they will go to the pp_checkout_failure page.
The Standard checkout makes use of the checkout form. The user will enter their details then when they proceed with the checkout they should be sent to PayPal to complete the transaction. They will then be returned to the site, since the status of the transaction will not be known at this time you should not assume that the transaction is successful. You will need to craft and test an IPN page to capture the resulting info.
I think it would be best to use only the Express Checkout option. It sounds like your pages are created correctly so you should not need to run through the wizard again. Instead you should just concentrate on getting the Express Checkout option working. If you are currently getting to the pp_checkout_failure page then you will need to add in debugging info to this page to see what the problem might be. Open the pp_checkout_failure page and add in this code to the page:
echo "<p>Express Authorize: <br />";
echo "Full Request: ".(isset($_SESSION["ECO_Auth_Request"])?htmlentities($_SESSION["ECO_Auth_Request"]):"n/a")."<br />";
echo "Full Response: ".(isset($_SESSION["ECO_Auth_Result"])?htmlentities($_SESSION["ECO_Auth_Result"]):"n/a")."<br /></p>";
echo "<p>Express Process: <br />";
echo "Full Request: ".(isset($_SESSION["ECO_Process_Request"])?htmlentities($_SESSION["ECO_Process_Request"]):"n/a")."<br />";
echo "Full Response: ".(isset($_SESSION["ECO_Process_Result"])?htmlentities($_SESSION["ECO_Process_Result"]):"n/a")."<br /></p>";
Please post back with the info that you get after you put this code on the page and run a test transaction.