They could make cash from the fluctuations in Bitcoin's price, as opposed to transaction fees. This would force them to create an exchange and act as a wallet. This would not only help PayPal business wise, but it would help the people who are interested in Bitcoin get involved that aren't too sure about about digital currencies. If they don't do it, they'll be out of business from someone that will.

Exchange/Wallet combination idea comes from http://www.panture.com/why-paypal-should-integrate-a-wallet-service-for-bitcoin/