I've worked this out with the support of a PayPal dev. One needs to add:
<configSections>
<section name="paypal" type="PayPal.Manager.SDKConfigHandler, PayPalCoreSDK"/>
</configSections>
<paypal>
<accounts>
<account apiUsername="xxx"
apiPassword="yyy"
applicationId="APP-80W284485P519543T"
apiSignature="zzz"
/>
</accounts>
<settings>
<add name="mode" value="sandbox"/>
</settings>
</paypal>
where xxx
, yyy
, zzz
you are values that you get from the "Account details" of your main sandbox test account.