Paypal IPN URL is giving error Failure: Missing Parameter
The "payment processor ID" is an integer, not a string - this may be your issue.  Go to Administer menu » System Settings » Payment Processor.  Next to the PayPal Standard processor you're working on, click the Edit link.  You should get a new page with a URL that looks like this:

http://dmaster.localhost/civicrm/admin/paymentProcessor?action=update&amp;id=5&amp;reset=1

Note the parameter near the end &amp;id=5.  Whatever number is showing there (instead of "5") is your payment processor ID.  Change the "2" at the end of the pingback URL to match your payment processor ID.