Pausing cuts off all sound. Also, you can't have any animation happening. There are a lot of things that don't make sense in Director and this is one of them. I don't really understand how it works and haven't found anything helpful about enterFrame yet. I don't think any of the above is correct.
Pause stops the motion of the playback head.
It does not prevent the proper delivery of mouse and keyboard events. In fact, pause usually depends on mouse and keyboard events being used to continue playback. I play sound and video in paused frames all the time. Using an on idle or timeoutscript handler, I think you can give QuickTime more CPU cycles without burning cycles in Director from needless churning. I usually prefer the pause.