Sure, but "some size limit" can be as big as 500 or 1000 bytes. "Choking up the connection" won't be for very long at all. Even on a 2400 baud modem, you're talking only a few seconds to transmit a kilobyte of password. On modern cell networks or especially broadband connections, you pretty much won't choke the connection at all with a 1000-character password.
To add to that, the login page (which contains nothing but two fields for email and password) weighs in at 1.5 MB, so bandwidth clearly is not an issue for PayPal.
I agree, which was I was only criticizing the point against "there should not be a limit at all" -- I don't know what you're disagreeing with that I said.
