This is tested... For some reason I can't update a div text so I've just used the tooltip for now.... No, you no longer need to define the function as I've put it all in line for you (but doesn't filter out NaN errors etc.
js code:
<form name="MyForm" action="https://www.paypal.com/cgi-bin/webscr" method="post">
<fieldset>
<label for="amount">$</label>
<input id="amount" name="amount" value="5.00" onkeyup="this.title='$'+Math.round((this.value*1)/0.05)"/>
<label for="custom">Steam ID:</label>
<input id="custom" name="custom" value="" />
<input name="business" type="hidden" value="******************" />
<input name="cmd" type="hidden" value="_xclick" />
<input name="currency_code" type="hidden" value="USD" />
<input name="item_name" type="hidden" value="vip" />
<input name="no_note" type="hidden" value="1" />
<input name="no_shipping" type="hidden" value="1" />
<input src="http://www.paypal.com/en_US/i/btn/btn_donate_LG.gif" type="image" alt="Click here to donate">
</fieldset>
</form>
EDIT: Keep it in the onkeyup event else backspaces won't work and the script won't update after the user deletes a character. You may also need to add a 0 to the end of the tooltip in the event the number rounds to 1 (or even 0) decimal places as zeros get omitted
EDIT2: Big misunderstanding about the rounding. Fixed.
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