Funny you should mention it... I just had a breakthrough on this for myself. I've been a Time/Design user and a Palm user, and have been GTD-ing since 1996. I've gone back and forth between paper & electronic several times in the past 12 years, and I think that's OK. As my life and work has undergone shifts, so does my system...
I like interacting with my calendar in paper -- not just printing out an electronic calendar, but being able to put a big swath of colour over days, being able to writ esomething in pencil, and what's the most fun of all: being able to put "fake" appointments in it! By "fake," I mean by creating appointments that I might have were I living the life of my dreams. Call it "acting as if," "deliberate creation," or whatever you'd like. And I'm here to tell you it WORKS. I am going to London next week because of having put the trip down as a "fake" appointment. I'm LOVING this new way of visualizing.
Do I get confused? No... I just put an * before any fake appointments. But the act of actually WRITING them down connects my brain/creative powers/ intention to the exercise more than just typing would. Personal preference, of course.
What I love about the Palm is its portability, and its ability to handle recurring calendar items. So I keep all my birthday/periodic activity reminders in the Palm, and they beep at me lovingly when necessary. I also keep my memo lists (all sorts of someday/maybe, reference, etc.) in the Palm. I think that's where typing quickly and bypassing my brain actually comes in handy. I don't censor myself if I have a quick idea of a "nice to have..." or whatever. Then if it becomes a real project or next action, it goes into the Time/Design system.
I think Palm and paper do different things really well. When I go to London next week, I'm just taking my Palm. I'll transfer any necessary calendar items for those few days from the Time/Design to the Palm, and I'll capture any context-based next actions I get while I'm there in the Palm, or my "UCT"... So no lugging the ginormous binder through Customs!!!
Hope this wasn't too long & rambling, but I do believe in having your tools work for you, and supporting whatever vision you have for your life, and not having them be an anchor holding you back... Good luck with the Palm/paper combination!