paypal can provide a service to whoever they like, im sure their Terms and Conditions leave a lot of wiggle room where they need it but I imagine they will use a clause to prevent piracy, Netflix has rights to stuff in certain geographic areas, to bypass those limitations probably falls foul of DMCA or at least could fall foul of DMCA so to prevent them from facing any sort of legal challenge they will stop servicing these companies, I expect if you advertise yourself as a means of bypassing netflix restrictions you will come up on their radar a lot faster than if you are just a VPN provider.
