It will only create duplicate content if you have other static content within the page that shows up on the paginated pages. If that’s the case, pagination definitely isn’t suggested.
I definitely wouldn’t recommend it over the regular loop, but it doesn’t hurt as long as the content isn’t duplicated. That being said, the purpose of WPSP is to show short lists of posts within static pages.
Not sure what you mean about an unlimited scroll button? WPSP Pro has AJAX pagination, and so does the standard GP blog.