The reason PayPal are embracing bitcoin is because they are currently unable to serve the market of digital asset vendors.
http://en.wikipedia.org/wiki/Chargeback#Reason_codes
Check out this "Quality" reason code. It essentially allows blatant theft of digital products. Take this scenario:
1. I buy a digital asset from you (some Photoshop design files) for $100
2. I claim the files are of poor quality and open a Paypal dispute
3. Paypal sides with you and stating digital assets cannot be returned, the dispute is closed in your favour
4. I escalate the dispute to my credit card company
5. The CC company says "Did you return the product?"
6. I say "hurr durr Yes... I sent it (the files) back" (Digital assets cannot be returned)
7. The CC company approves the chargeback and forcibly takes the money from Paypal
8. Paypal says "So sorry, it's the banks not us" and takes your money
9. Now I have my $100 and your Photoshop files.
10. Enter bitcoin
Paypal loves bitcoin because they hate CC companies, not necessarily because they think it's cool.
