This is due to repeated cases where someone pays for Bitcoins with Paypal, receives their Bitcoins, and then fraudulently complains to Paypal that they never received their goods. Paypal too often sides with the fraudulent buyer in this case, and so exchangers no longer allow this method of funding.
quote: It's not so much that someone says "too fast!" and ups the difficulty, it's more like the difficulty increases as there are fewer BitCoins left to 'find'. There are a limited number of BitCoins , each one is more difficult to find than the last.