Bitcoin is a becoming a real currency and wants to become a currency, with paypal this is not the point at all.
I disagree, you can still pay with them both and they are both used for transactions and payments so I think you can compare them with each other.
Overall I think the bitcoin is much better because the lack of security at PayPal is clearly visible and its also that PayPal indeed limits accounts very fast because of suspicious behavior...
But users from paypal are also going to stop using paypal and they will now use Bitcoin more and that would be perfect for Bitcoin.
I think the users of paypal will keep on using the paypal if bitcoin is adopted by paypal. The fee will be lower.