Paypal is for businesses without the financial resources to accept credit cards directly, or maybe for businesses which list items for auction.
From a customer point of view, you are far better off paying directly by credit card, as compared to PayPal.
From a business point of view, accepting PayPal can be a real pain. PayPal is used to doing business with individuals of unknown financial responsibility. When something goes wrong, PayPal "locks" the account, spreading misery all over. If you're running a business, you expect to be financially responsible, and to be treated as if you're financially responsible, rather than have someone distrust your every move and shut you down at the first hint of trouble.