I'm not sure about the relation you are suggesting between block size and price determination. In the end it's the market that determines the price, so you
could easily have 10x the amount of transactions that paypal has, but if that capacity is not used - it probably won't be a variable important for price estimation.
On the other hand, if one would say that nr. of transactions matches pp, then it would make a difference, because it would suggest that user base grew, interest is growing, and ofc price goes up.
The original post is mostly concerned about WHEN and HOW Bitcoin can match or pass Paypal's market cap of around 50 billion. Most people currently don't see Paypal as a store of value since it involves both counterparty risk and investment into fiat confetti. If Bitcoin were to reach Paypal market cap with 1 meg blocks, sentiment towards Bitcoin as a store of value would have to increase a good bit, which is entirely possible when the added value of decentralization is currently priced in very low.
I'm hoping for more certainty than just praying for an increase. On paper, as I mentioned in the original post, if Bitcoin can produce 1/2 of Paypal's TPS, then the market cap should at least equal Paypal's in time without hopes, dreams, or prayer required.